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Brilliant_brown [7]
1 year ago
11

Accounting and financial reporting for state and local governments use, in different places, either the economic resources measu

rement focus and the accrual basis of accounting or the current financial resources measurement focus and the modified accrual basis of accounting. Discuss the differences in measurement focus and basis of accounting related to (a) the conceptual differences, (b) differences in revenue recognition, (c) differences in expense/expenditure recognition, (d) differences in recognition of fixed assets, and (e) differences in the recording of long-term debt.
Business
1 answer:
Agata [3.3K]1 year ago
7 0

The differences in measurement focus and basis of accounting related:

<h3>What is Accrual Accounting?</h3>

Accrual accounting is the process of recording the transactions whenever the expenses or revenues are incurred. This helps the employees not to miss the transactions that occur daily. The revenue recognition will be appropriate under this method.

(A) Differences in conceptual differences :

The economic resources measurement focus measures all economic resources, including capital assets and long-term debt.

The current financial resources measurement focus measures financial resources and does not recognize long-term assets and liabilities. The accrual basis of accounting recognizes revenues When earned and expenses when incurred. (when goods or services are used).

The modified accrual basis of Accounting recognizes revenues when measurable and available to finance Expenditures of the current period. The modified accrual basis of accounting recognizes expenditures generally when the fund liability is incurred except for payments of interest on long-term debt Which are recognized when due.

(B) Differences in Revenue Recognition:

Under accrual accounting revenues based on exchange transactions are recognized when earned. Revenues based on non-exchange transactions are recognized according the provisions of GASB Statement 33.

Under modified accrual accounting, revenue recognition is modified to require that the amount be measurable (determinable) and available to finance expenditures of the current period.

(C) Differences in Expense/Expenditure Recognition:

Under accrual accounting, expenses are recognized when incurred. Expenses are often matched with revenues those expenses generate, in the case of exchange transactions. Accruals are required for interest and other expenses, regardless of when cash is to be transferred.

Under modified accrual accounting, expenditures (not expenses) are recorded generally when goods or services are received.

(D) Differences in recognition of fixed assets:

Under the economic resources measurement focus and accrual accounting, fixed assets are capitalized and depreciated .

Under the current financial resources measurement focus and modified accrual accounting, fixed assets are not capitalized or depreciated; rather fixed assets are charged to expenditures when received.

(E) Differences in the recording of long-term debt:

Under the economic resources measurement focus and accrual accounting, long-term debt is recorded as a liability; repayments are recorded as a reduction of that liability.

Under the current financial resources measurement focus and modified accrual accounting, long-term debt is not recorded as a liability.

Learn more about Accrual Accounting on:

brainly.com/question/25817056

#SPJ4

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Assuming that the federal reserve banks sell $40 million in government securities to commercial banks and the reserve ratio is 2
sdas [7]

The reserve requirement when the federal reserve banks sell $40 million in government securities to commercial banks is $8 million.

<h3>How to calculate the reserve requirement?</h3>

From the information given, the the federal reserve banks sell $40 million in government securities to commercial banks and the reserve ratio is 20 percent.

Therefore, the reserve requirement will be:

= 20% × $40 million

= $8 million.

Learn more about reserve requirements on:

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8 0
1 year ago
Correl Corporation has provided the following data concerning an investment project that it is considering: Initial investment $
Marianna [84]

Answer:

 A. $38,500 

Explanation:

The net present value is the present value of after tax cash flows from an investment less the amount invested.

Npv can be calculated using a financial calculator.

Cash flow in year 0 = $-190,000

Cash flow each year from 1 to 3 = $75,000

Cash flow in year 4 = $75,000 + $25,000 = $100,000

I = 15%

NPV = $38,417.21

To find the NPV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

6 0
3 years ago
For 2012 Fielder Corporation reported net income of $30,000; net sales $400,000; and average share outstanding 12,000. There wer
jonny [76]

Answer:

$2.50

Explanation:

The Earnings Per Share of a company is determined by using the formula:

EPS= (Net Income of the Company - Dividend to Preferred Shareholders) ÷ Average Outstanding Shares of the Company

Since there is no dividend to preferred shareholders

EPS= Net Income of the Company - ÷ Average Outstanding Shares of the Company

=30000 ÷ 12000

=$2.50

5 0
3 years ago
The newspaper reported last week that Bennington Enterprises earned $28 million this year. The report also stated that the firm�
rosijanka [135]

Answer: a). Firm's growth rate = 10.5%

b). Next year's earnings = $30,940,000.00

Explanation: Earnings growth rate is the percentage change in earnings given specific variables.

The firm's earnings growth rate g = Return on equity (ROE) × Retained earnings (b) = 0.15(0.70)

g =0.105 or 10.5%

In finding next year's earnings, we multiply the current earnings times one plus the growth rate.

Next year's earnings = Current earnings(1 + g)

Next year's earnings = 28,000,000(1 + 0.105)

Next year's earnings = $30,940,000.00

7 0
3 years ago
Read 2 more answers
A the production possibilities frontier (PPF) is bowed outward as a result of:_________
vodomira [7]

Answer: 2) increasing opportunity costs.

Explanation:

The Production Possibilities frontier is bowed out as it shows that for one more unit of a good to be produced, an additional unit of the other good must be given up.

This represents increasing opportunity costs because opportunity cost is the cost we incur for choosing one alternative over another. By producing more and more of one good, we give up more and more of the other good which means that our opportunity cost rises.

8 0
3 years ago
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