ACC 557 Homework 5 Chapter 13 Due Week 9 And Worth 50 Points

Acc 557 Homework 5 Chapter 13due Week 9 and Worth 50 Pointsdirectio

Answer the following questions on a separate Microsoft Word or Excel document. Explain how you reached the answer or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in Blackboard.

Paper For Above instruction

This comprehensive examination of accounting transactions, cash flow analysis, pension accounting, and fixed asset depreciation emphasizes the importance of accurate financial reporting and understanding of related concepts. The assignment focuses on journal entries for specific transactions, preparation of cash flow statements using the indirect method, pension plan accounting, and correction of depreciation errors. Proper understanding of these topics is vital for maintaining accurate financial records, complying with accounting standards, and providing valuable insights for decision-makers.

Introduction

The core objective of this assignment is to enhance understanding of fundamental accounting procedures and reporting requirements. It provides practical application exercises involving journal entries, cash flow statement preparation, pension worksheet analysis, depreciation correction, and financial statement adjustments. By working through these exercises, students develop critical skills in analyzing and recording financial transactions in accordance with Generally Accepted Accounting Principles (GAAP).

Journal Entries for Transactions

In the first section, students are tasked with creating journal entries for a series of diverse transactions from Cushenberry Corporation. These include the sale of land, issuance of common stock, depreciation on buildings, salaries paid, issuance of stock for equipment, and sale of equipment. Understanding how these transactions affect accounts and how they are reflected in financial statements is essential. For each transaction, students must prepare the journal entry and analyze its impact on cash flows using the indirect method.

Statement of Cash Flows Preparation

The subsequent exercises focus on preparing the operating activities section of the statement of cash flows utilizing the indirect method. This includes analyzing net income, depreciation expense, asset disposals, and changes in working capital components such as accounts receivable, payable, and prepaid expenses. Correctly adjusting net income for non-cash items and changes in working capital illustrates how cash flows derive from operations in accordance with accounting standards.

Pension Plan Accounting

Further, students analyze pension plan balances and related data to prepare a pension worksheet over two years, 2014 and 2015. This involves calculating pension expense, understanding the components of pension liabilities and assets, and recording journal entries. Pension accounting is complex, involving actuarial assumptions, unrealized gains/losses, prior service costs, and amortizations. Proper comprehension ensures accurate reporting of pension obligations in financial statements.

Correction of Depreciation Errors

The exercises also address correcting depreciation errors for equipment, building, and machinery. Students compute correct depreciation charges based on new estimates, rectify prior errors, and understand the impact on net income. Accurate depreciation ensures correct valuation of assets and truthful representation of profitability over periods.

Financial Statement Restatements

Finally, the assignment explores adjustments due to inventory errors, accounting principle changes, and other misstatements, emphasizing the importance of transparency and accurate reporting. Restating prior period financials when necessary maintains comparability and compliance with accounting standards.

Conclusion

This assignment encapsulates key accounting competencies—journal entry preparation, cash flow analysis, pension accounting, depreciation correction, and financial statement adjustment. These skills are fundamental for accounting professionals, auditors, and financial analysts, ensuring integrity and transparency in financial reporting.

References

  • Kieso, D. E., Weygandt, J. J., & Warfield, T. D. (2019). Intermediate Accounting (15th ed.). Wiley.
  • FASB. (2020). Accounting Standards Codification (ASC). Financial Accounting Standards Board.
  • GASB. (2020). Pension and Other Postemployment Benefits (OPEB). Governmental Accounting Standards Board.
  • Heisinger, K. R., & Hoyle, J. B. (2018). Advanced Financial Accounting. Cengage Learning.
  • Henderson, S., & Dempsey, T. (2019). Principles of Financial Accounting. McGraw-Hill Education.
  • IRS. (2022). Publication 535: Business Expenses. Internal Revenue Service.
  • Schroeder, R. G., Clark, M. W., & Cathey, J. M. (2019). Financial Accounting Theory and Analysis. Wiley.
  • CPA Canada. (2021). Financial Statements and Auditing Standards. CPA Canada Handbook.
  • International Accounting Standards Board (IASB). (2020). IFRS Standards.
  • Omar, H. (2019). Practical Guide to Financial Statements Analysis. Routledge.

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