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Question
Classifying financial statement accounts. The balance sheet or income statement classifies various items in one of the following ways:
CACurrent assets
NANoncurrent assets
CLCurrent liabilities
NLNoncurrent liabilities
CCContributed capital
RERetained earnings
NIIncome statement item (revenue or expense)
XItem generally does not appear on a balance sheet or an income statement
Using the abbreviations in the previous list, indicate the classification of each of the following items under U.S. GAAP and IFRS. If the classifications differ between U.S. GAAP and IFRS, indicate what that difference would be.
a. Interest revenue.
b. Factory.
c. Treasury shares repurchased by a corporation.
d. Research and development expenditures.
e. Automobiles used by sales staff.
f. Cash on hand.
g. Promise to a vendor to buy inventory from it next period.
h. Commissions earned by sales staff.
i. Supplies inventory.
j. Note payable, due in six months.
k. Increase in fair value of land held.
l. Income taxes owed to state or city government.
m. Note payable, due in ten years.
n. The portion of the note payable in part n that is due next year.
o. Dividends declared.
Answer
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