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NEW QUESTION: 1
On January 2, 1993, Quo, Inc. hired Reed to be its controller. During the year, Reed, working closely with
Quo's president and outside accountants, made changes in accounting policies, corrected several errors
dating from 1992 and before, and instituted new accounting policies.
Quo's 1993 financial statements will be presented in comparative form with its 1992 financial statements.
This question represents one of Quo's transactions. List A represents possible clarifications of these
transactions as: a change in accounting principle, a change in accounting estimate, a correction of an
error in previously presented financial statements, or neither an accounting change nor an accounting
error.
During 1993, Quo increased its investment in Worth, Inc. from a 10% interest, purchased in 1992, to 30%,
and acquired a seat on Worth's board of directors. As a result of its increased investment, Quo changed
its method of accounting for investment in Worth, Inc. from the cost method to the equity method.
List A
A. Change in accounting principle.
B. Correction of an error in previously presented financial statements.
C. Change in accounting estimate.
D. Neither an accounting change nor an accounting error.
Answer: D
Explanation:
Choice "d" is correct. A change from the cost method (less than 20% ownership) to the equity method
(20% or more ownership or a Board seat or other significant influence) of accounting for investment in an
investee is neither an accounting change nor an accounting error. If it is not an accounting change, it
cannot be a change in accounting principle or a change in accounting estimate since those two types of
changes are both accounting changes.
There is a considerable amount of controversy on this particular answer. Some people think that this
change is a change in accounting principle (something certainly changed, but was it the accounting
principle?), and others think it is a change in accounting entity (which is not one of the available answers;
anyway, did the accounting entity actually change or is it the same entity accounted for differently?).
Under SFAS No. 154, a change in accounting principle is treated retrospectively and a change in
accounting entity is treated retrospectively.
This kind of change (cost to equity) has never been specifically identified in any accounting literature as
either a change in accounting principle or a change in accounting entity. The words "cost method" were
never mentioned in APB 20 (other than the full cost method for oil & gas companies, which is an entirely
different subject), nor was it mentioned in SFAS No. 154. It was, however, discussed in APB 18 (the
pronouncement for the equity method) in Paragraph 19m (bold added): "An investment in common stock
of an investee that was previously accounted for on other than the equity method may become qualified
for use of the equity method by an increase in the level of ownership described in paragraph 17 (i.e.,
acquisition of additional voting stock by the investor, acquisition or retirement of voting stock by the
investee, or other transactions). When an investment qualifies for use of the equity method, the investor
should adopt the equity method of accounting. The investment, results of operations (current and prior
periods presented), and retained earnings of the investor should be adjusted retroactively in a manner
consistent with the accounting for a step-by-step acquisition of a subsidiary."
What does all this mean? It means that, when there is a change in the percentage of ownership that
changes accounting from the cost method to the equity method, the change is treated retroactively (just
like changes in accounting entity used to be treated, although they are now treated retrospectively). It
does not say that the change is a change in accounting principle or anything else. Nothing in SFAS
No.154 changed this treatment. So all this still makes Choice "d" correct. This whole issue might easily be
considered to be splitting hairs, at the very least. Some questions on the CPA exam are just that way.
Most are not.
NEW QUESTION: 2
You need additional security and are configuring IP source guard.
Which three statements accurately describe IP source guard? (Choose three.)
A. The default setting for access ports using IP source guard is untrusted.
B. IP source guard does not check packets received on a trunk interface.
C. Packets with an invalid IP address or MAC address are rejected.
D. IP source guard checks the IP/MAC address of packets received against entries stored in the DHCP snooping database.
E. You can enable IP source guard on interfaces and VLANs.
Answer: A,B,D
NEW QUESTION: 3
Which of the following is a responsibility of the Scrum Master in the context of change in Scrum?
A. Approving changes that are amended, removed, or added according to project requirements, and communicating the same to the Scrum Team.
B. Facilitating identification of Change Requests by the Scrum Team and their assessment and prioritization by the Product Owner.
C. Providing requests for changes in a project.
D. Eliminating all changes that may affect the quality of deliverables and processes
Answer: B
NEW QUESTION: 4
展示品に折れ線グラフが表示されています。 （[展示]タブをクリックします。）
次の要件を満たすようにチャートを変更する必要があります。
注文数が平均を上回っている月を特定します。
月間平均注文数を表示します。
どの3つのアクションを順番に実行する必要がありますか？回答するには、適切なアクションをアクションのリストから回答領域に移動し、正しい順序で配置します。
Answer:
Explanation:
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