Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 10, Problem 1BCC
a.
To determine
The reason that IASB decided not to allow the use of LIFO method.
b.
To determine
The reason for agreement or disagreement with IASB.
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If circumstances indicate that an inventory write-down is no longer appropriate: a. The write-down can be reversed under U.S. GAAP. b. The write-down can be reversed under IFRS. c. The write-down can be reversed under both U.S. GAAP and IFRS. d. The write-down can’t be reversed under either U.S. GAAP or IFRS.
answer please
Identify any differences between U.S. GAAP and IFRS when applying the lower of cost and net realizable value rule to inventory valuation.
Chapter 10 Solutions
Intermediate Accounting (2nd Edition)
Ch. 10 - How is inventory tracked under a perpetual...Ch. 10 - Barbara Wight is Chief Financial Officer at Taylor...Ch. 10 - What costs should be included in the unit cost of...Ch. 10 - When does the inventory allocation problem arise?Ch. 10 - Explain the difference between the FIFO method of...Ch. 10 - Which method of inventory results in an inventory...Ch. 10 - If unit costs are rising and inventory levels are...Ch. 10 - How can financial statements be converted from the...Ch. 10 - Explain the unit of measure under the dollar-value...Ch. 10 - What do firms use as the market value when...
Ch. 10 - Do U.S. GAAP and IFRS treat inventory write-downs...Ch. 10 - Under IFRS, how do firms determine...Ch. 10 - How does the conventional retail method...Ch. 10 - Why would a company use the gross profit method to...Ch. 10 - How are required LIFO disclosures used to compute...Ch. 10 - How does a company build LIFO layers under the...Ch. 10 - Giddens Company adopted the dollar-value UFO...Ch. 10 - The Loyd Company lad 150 units of product Omega on...Ch. 10 - Simmons, Inc. uses the lower-of-cost-or-market...Ch. 10 - Simmons, Inc. uses the lower-of-cost-or-market...Ch. 10 - The Loyd Company had 150 units of product Omega on...Ch. 10 - The Loyd Company had 150 units of product Omega on...Ch. 10 - On March 1, Year 1, LuxWear me had beginning...Ch. 10 - Types of Manufacturing Inventory. Complete the...Ch. 10 - Periodic Inventory System. Emmy Company uses a...Ch. 10 - Prob. 10.3BECh. 10 - Prob. 10.4BECh. 10 - FIFO, Perpetual Basis. Spider incorporated...Ch. 10 - LIFO, Perpetual Basis. Using the information...Ch. 10 - Prob. 10.7BECh. 10 - LIFO Reserve. Best Stores is considering a change...Ch. 10 - LIFO. Perpetual Basis. Source Enterprises reports...Ch. 10 - LIFO Liquidation. Using the information provided...Ch. 10 - Prob. 10.11BECh. 10 - Dollar-Value LIFO, Conversion to FIFO. Using the...Ch. 10 - Lower of Cost or Market. Count Clothing Company...Ch. 10 - Lower of Cost or Market. Using the information in...Ch. 10 - Lower of Cost or Market, IFRS. Using the...Ch. 10 - Prob. 10.16BECh. 10 - Prob. 10.17BECh. 10 - Lower of Cost or Market. Sarat Boot Company...Ch. 10 - Prob. 10.19BECh. 10 - Prob. 10.20BECh. 10 - Prob. 10.21BECh. 10 - Gross Profit Method. Sammi Company needs to...Ch. 10 - Prob. 10.23BECh. 10 - LIFO Retail Inventory Method. Complete the...Ch. 10 - LIFO Retail Inventory Method. Complete the...Ch. 10 - Moving Average, FIFO, LIFO. Arthur Lloyd...Ch. 10 - Moving Average, FIFO, LIFO, Presentation, and...Ch. 10 - Moving Average, FIFO, LIFO. Zoola, Inc. provided...Ch. 10 - Prob. 10.4ECh. 10 - LIFO, Conversion to FIFO. Inventory transactions...Ch. 10 - LIFO. Burke Company uses the LIFO perpetual method...Ch. 10 - Prob. 10.7ECh. 10 - Dollar-Value LIFO, LIFO Reserve. CWB Teleconcepts,...Ch. 10 - Dollar-Value LIFO, No Liquidation. Joe the Grocer...Ch. 10 - Prob. 10.10ECh. 10 - Lower of Cost or Market. All-Kinds-of-Cases...Ch. 10 - Prob. 10.12ECh. 10 - Lower of Cost or Market. Printmaster Distributors...Ch. 10 - Prob. 10.14ECh. 10 - Prob. 10.15ECh. 10 - Conventional Retail Inventory Method. Melvin...Ch. 10 - Gross Profit Method. A tsunami destroyed Kyoto...Ch. 10 - Prob. 10.18ECh. 10 - Prob. 10.19ECh. 10 - Prob. 10.20ECh. 10 - Dollar-Value LIFO Retail Inventory Method....Ch. 10 - Moving Average, FIFO, LIFO. Morocco Imports...Ch. 10 - Prob. 10.2PCh. 10 - LIFO, Conversion to FIFO. The Outsider Company,...Ch. 10 - Dollar-Value LIFO. The Happenings Company adopted...Ch. 10 - Dollar-Value LIFO. No Liquidation. Nat's Toy...Ch. 10 - Dollar-Value LIFO, LIFO Liquidation. The following...Ch. 10 - Dollar-Value LIFO. LIFO Liquidation. Silvio's...Ch. 10 - Lower of Cost or Market. Framingdale Factories....Ch. 10 - Lower of Cost or Market. O'Sullivan Corporation...Ch. 10 - Conventional Retail Inventory Method. John Stevens...Ch. 10 - Prob. 10.11PCh. 10 - Prob. 10.12PCh. 10 - Basic Retail Inventory Method and Conventional...Ch. 10 - Basic Retail Inventory Method and Conventional...Ch. 10 - Prob. 10.15PCh. 10 - Conventional Retail Inventory Method, Lower of...Ch. 10 - Prob. 1JCCh. 10 - Judgment Case 2: Inventory Costing BBS is a...Ch. 10 - Judgment Case 3: Lower of Cost or Market KR...Ch. 10 - Prob. 1FSCCh. 10 - Prob. 2FSCCh. 10 - Prob. 1SSCCh. 10 - Prob. 2SSCCh. 10 - Surfing the Standards Case 3: Time Shares Treasure...Ch. 10 - Surfing the Standards Case 4: Lower of Cost or...Ch. 10 - Prob. 1BCCCh. 10 - Basis for Conclusions Case 2: The Lower of Cost or...
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- One of the significant remaining differences between U.S. GAAP and IFRS is the treatment of inventory. Which of the following accurately states the reason for this significant difference? O IFRS does not allow LIFO. O IFRS does allow Dollar Value LIFO. O IFRS does allow Weighted Average. O IFRS does not allow FIFO.arrow_forwardAccess the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ). Determine the specific citation for accounting for each of the following items: 1. Reporting most changes in accounting principle. 2. Disclosure requirements for a change in accounting principle. 3. Illustration of the application of a retrospective change in the method of accounting for inventory.arrow_forwardWhich of the following statements is incorrect? Select one: a. By using the IFRS, goods shipped on consignment from a seller to another company should be included in the inventory of the seller. b. Many argue that LIFO provides a better matching of current costs against revenue from a financial reporting point of view. c. Both IFRS and GAAP account for inventory acquisitions at historical cost and value inventory at the lower-of-cost-or-net-realizable value subsequent to acquisition. d. Both inventory and net income are higher when companies use LIFO in a period of inflation.arrow_forward
- Determine what report (unqualified, qualified, adverse, or disclaimer) is appropriate Your client uses a non-GAAP inventory method to determine inventory valuation but otherwise the financial statements are prepared according to GAAP. You agree with management that the using this inventory method is appropriate and the financial statements, taken as a whole, are fairly stated. Group of answers: Qualified Opinion with explanatory paragraph Adverse Opinion Unqualified Opinion with additional explanatory paragraph Disclaimer - independence explanation Unmodified Unqualified Opinion Disclaimer - scope limitation explanation Unqualified Opinion with except for paragraph Qualified Opinion with Except for paragrapharrow_forwardWhen comparing a US company that uses the last in, fi rst out (LIFO) method of inventory with companies that prepare their fi nancial statements under international fi nancialreporting standards (IFRS), analysts should be aware that according to IFRS, the LIFOmethod of inventory:A . is never acceptable.B . is always acceptable.C . is acceptable when applied to fi nished goods inventory onlyarrow_forwardNeed help ASAParrow_forward
- Which of the following statements is not incorrect? I. PAS 2 requires the use of the Allowance Method in accounting for inventory write-down. II. There shall always be an allowance for inventory write-down if the net realizable value of inventories is lower than its cost. III. Regardless of what method the company uses in accounting for inventory write-down, the cost of goods sold must always be the same IV. A company may recognize a gain on reversal of inventory write-down even if the cost of inventory exceeds its net realizable value. a. I and II b. None of these c. II and III d. III and IV e. I and IVarrow_forwardUnder ASC Topic 606 for revenue recognition, which of the following factors is not an indicator of the principal/agent determination? A. Inventory risk. B. Credit risk. C. Shipping terms.arrow_forwardResearch the IFRS authoritative literature and provide answers to the following questions.Paragraph citations are to be provided with answers where applicable.1. State the authoritative literature that governs inventory. 2. Identify three (3) types of assets that are classified as inventory. 3. What inventories are specifically excluded from this standard? 4. How is the term ‘net realizable value’ defined as used in the acronym LCNRV.arrow_forward
- According to the IMA’s Statement of Ethical Professional Practice, would it be ethical for Perlman notto report the inventory as obsolete?arrow_forwardReview the new revenue recognition guidance issued by the Financial Accounting Standards Board http://www.fasb.org/jsp/FASB/Page/ImageBridgePagecid=1176169257359 and answer the following questions. What is the new standard as of ASC 606? What does that mean to you? What are the recommended steps companies should follow to achieve the core principle? How does this change current GAAP standards? Who is required to adhere to this new standard?arrow_forwardView Policies Current Attempt in Progress Which costing method cannot be used to determine the cost of inventory items before lower-of-cost- or-net realizable value is applied? O Specific identification. FIFO. O LIFO. O All of these methods can be used. eTextbook and Media Save for Later Submit Answer Attempts: 0 of 1 used Com the s the s. Suprat Supratarbo O not co uboarrow_forward
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