Accounting (Text Only)
26th Edition
ISBN: 9781285743615
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 15FSI, Problem 2IFRS
(a)
To determine
Generally Accepted Accounting Principles (GAAP): These are the guidelines necessary to create accounting principles for the implementation of financial information reporting in the Country U.
International Financial Reporting Standards (IFRS): IFRS are a set of international accounting standards which are framed, approved, and published by International Accounting Standards Board (IASB) for the preparation and disclosure of international financial reports.
To explain: The differences in the presentation of
(b)
To determine
To compare: The financial statement terms used by Company L and MJ International
(c)
To determine
To discuss: The term ‘revaluation reserves’ reported in equity section by Company L
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Nestlé S.A., the largest food and beverage company in the world, prepares its financial statements according to International Financial Reporting Standards. Its financial statements include ordinary share capital, translation reserve, and share premium. If Nestlé used U.S. GAAP, what would be the likely account titles for these accounts?
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1. Prepare financial statements (income statement, statement of retained earnings, and balance sheet) for the Canadian subsidiary in its functional currency, Canadian dollars.2. Translate the Canadian dollar functional currency financial statements into U.S. dollars so that Sendelbach can prepare consolidated financial statements.
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