Accounting Question

Acct 332 ASC Research AssignmentYour Name:
Your Section Number:
Question 1:
ASC Citation Number:
INSERT CITATION HERE
Include here your written Description of the US GAAP guidance in your own words. Do not repeat
the research question. Do not directly quote the ASC. Use Calibri font, Size 12, Double-Spaced lines.
Submit only this Word document, do not submit a pdf document.
Question 2:
ASC Citation Number:
INSERT CITATION HERE
Include here your written Description of the US GAAP guidance in your own words. Do not repeat
the research question. Do not directly quote the ASC. Use Calibri font, Size 12, Double-Spaced lines.
Submit only this Word document, do not submit a pdf document.
1
ASC Research Assignment 1
Acct 332
Fall 2023
Accounting Standards Codification
Research Assignment
There are 2 parts to this document.
Part 1. ASC Research Assignment INSTRUCTIONS. You will provide a written response to
2 research questions. Students are required to search the ASC for the GAAP guidance
(language) which answers the research questions. Each research question requires (1) an
ASC citation number, and (2) a written description of the GAAP guidance using only your
own words. Do not include any quotation from the ASC in your response.
Part 2. OVERVIEW of the Accounting Standards Codification (ASC). You will learn about the
hierarchical structure of the ASC and understand how to search and identify by citation the
location of the specific GAAP guidance which responds to a research question. This overview
will help you complete the research assignment requirements.
Part 1. ASC Research Assignment – Instructions
Due Date: Wednesday, November 15. Upload your response in the Bb ASC assignment folder.
Required: Search the ASC to locate US GAAP guidance in response to two research questions.
Identify the ASC citation number and provide a written description of the GAAP guidance
which responds to the following 2 research questions. Use only your own words without any
direct quotation from the ASC.
1. Identify the ASC citation which explains how to determine if a dividend in the form of stock
should be treated as a stock dividend (what we call a “small stock dividend”) or a stock split
(what we call a “large stock dividend”) and provide a written description of the GAAP guidance
using your own words.
2. Identify the ASC citation which describes the Issuer’s accounting for a small stock dividend and
provide a written description of the GAAP guidance using your own words.
Format: Your written response to the research questions should be in the following format:
Word Document: Use the Word Document template provided in the Assignment folder.
Upload your Word document response to Blackboard by the due date. Do not upload a
PDF document.
Length: 1 page double-spaced, extending to 2 pages if necessary.
Do not submit more than 2 pages.
Size 12, Calibri font. This is the font you are reading now in this document.
ASC Research Assignment 2
Grading: The assignment will be graded on the following two criteria (20 points total):
1. Communication (10 points) – Quality of writing including language, spelling, punctuation,
and adherence to assignment requirements. The writing quality is evaluated by a writing
consultant and will be scored within the following ranges: Highly competent – 10 points,
Competent – 8 points, Marginally Competent – 6 points, Not Competent – 0 points.
2. Content (10 points) – This component is scored by the professor for citation references, for
the content of the written response to the research question, and for the student’s
adherence to the assignment instructions and requirements.
The GMU Honor Code applies to this writing assignment. The collaborative learning environment
of SafeAssign is used to ensure that plagiarism and other violations of the Honor Code are avoided.
Any student who chooses to violate the GMU Honor Code is subject to penalties as determined by
the University Honor Code Committee. These sanctions can include an “F” in this course, a notice of
violation in the student’s academic record, and possible suspension from the University. Please
carefully read the guidelines on avoiding plagiarism that follow below.
Guidelines to avoid plagiarism in your writing:
Plagiarism is the presentation of someone else’s written or other creative work as your own.
Obvious and egregious examples of plagiarism which will result in an Honor Code violation can
include, but are not limited to, the following:
•
Including in your written response information obtained from any type of “homework
help” or other website which is used to obtain answers to assignment research questions.
•
Copying someone else’s assignment or part of someone else’s assignment and submitting
it as your own.
•
Copying a portion of an article of press or other published writing verbatim into your
paper without properly citing it.
•
Also, simply copying the contents of the assignment given to you and presenting it as your
own writing is not appropriate. We recognize the need to sometimes re-state the
information given to you in a memo, but it must be done in your own words.
•
For the Mason general plagiarism policy, please see:
https://writingcenter.gmu.edu/writing-resources/citing-sources/plagiarism
ASC Research Assignment 3
Part 2. Overview of the Accounting Standards Codification (ASC):
All authoritative US GAAP is contained in a single source: the FASB Accounting Standards
Codification (ASC). A major leaning goal of this assignment is for all students to access the ASC and
to search for the GAAP authoritative guidance (language) which responds to a research question.
A. How to access the ASC. Mason students will use the following link and log-in information:
http://www2.aaahq.org/ascLogin.cfm
Username: AAA52638
Password: VU37XEr
B. Hierarchical structure of the ASC:
The ASC is organized by subject matter in a hierarchy of 4 levels.
Area
Topic
Subtopic
Section
The highest level is an Area. Topic, Subtopic, and Section represent increasingly smaller
collections of guidance within Areas. The highest 3 levels (Area, Topic, Subtopic) exist to
contain and organize the Section-level content (which contains authoritative guidance).
Each of these 4 levels is identified by a number. The ASC citation for the location of GAAP
guidance takes this generic form: ASC 123 – 45 – 67 – 89 (Area – Topic – Subtopic – Section)
Topic AREA structure – FASB Accounting Standards Codification
General Principles
Presentation
Assets
Liabilities
Equity
Revenues
Expenses
Broad Transactions
Industry
100
200
300
400
500
600
700
800
900
Each of these 9 AREAS include Topics, Subtopics, and
Sections. You are required to include ASC citations with
your written response to identify the location of the Section
containing the GAAP guidance that responds to each
research question.
ASC Research Assignment 4
Use the following two example research questions to practice navigating through the ASC to
explore the structure and to locate the citation that responds to the example research
questions. You can use the bar at bottom of the ASC website to see an outline of the hierarchy
levels (Area, Topic, Subtopic, Section) and the level of your search.
Example 1.
Research question: What ASC citation provides GAAP guidance for reporting cash effects on
the statement of cash flows. (Note: We will study the Statement of Cash Flows in Chapter 21.)
Solution: In the ASC, begin by searching for words included in the question, like “cash effects on
statement of cash flows”. Read the section(s) listed in the search results to identify the
appropriate guidance.
Example 1 Answer: ASC 230 – 10 – 45 – 1
Area Topic Subtopic Section
“230” is the Area (Presentation – Statement of Cash Flows), “10” is the Topic (Overall), “45” is
the Subtopic (Other Presentation Matters), and “1” is the Section number. Here is the actual
ASC GAAP guidance language on the website with the answer circled in red (and then
highlighted below):
In the screenshot above, 230 – 10 – 45 – 1 directly responds to the example research question.
The GAAP guidance text from section 1 above, and from the following sections 2 and 3, is
reproduced on the next page for discussion purposes:
ASC Research Assignment 5
230-10-45-1
A statement of cash flows shall report the cash effects during a period of an entity’s
operations, its investing transactions, and its financing transactions.
(Note to students: this Section 1 directly responds to the example research question.)
230-10-45-2
A reconciliation of net income and net cash flow from operating activities, which
generally provides information about the net effects of operating transactions and
other events that affect net income and operating cash flows in different periods, also
shall be provided.
(Note to students: this Section 2 means the Indirect Method of reporting Cash from
Operations must be disclosed even if the company uses the Direct Method of
reporting Cash from Operations in its Statement of Cash Flows.)
230-10-45-3
Financial statements shall not report an amount of cash flow per share. Neither cash
flow nor any component of it is an alternative to net income as an indicator of an
entity’s performance, as reporting per- share amounts might imply. Reporting a
contractually determined per-unit amount, such as a per unit amount of cash flow
distributable under the terms of a partnership agreement or other agreement between
an entity and its owners, is not the same as reporting a cash flow per-share amount
intended to provide information useful to all investors and creditors and thus is not
precluded by this Subtopic.
(Note to students: this Section 3 means we never report “Cash Flow Per Share”.
Only “Earnings Per Share” is reported with the Income Statement.)
Example 2.
Research question: What ASC citation provides GAAP guidance for a change in accounting
estimate related to a depreciation method change from double-declining balance to straight-line?
(Note to student: We will study Changes in Accounting Estimates in Chapter 20.)
Solution: Try to search the ASC for “change in estimate for depreciation methods”. Read the
section(s) listed in the search results to identify the appropriate guidance.
Example 2 Answer: ASC 250 – 10 – 45 – 18
Area Topic Subtopic Section
“250” is the Area (Presentation – Accounting Changes and Error Correction),
“ 10” is the Topic (Overall),
“ 45” is the Subtopic (Other Presentation Matters),
“ 18” is the Section. See next page for a screenshot of the actual ASC GAAP guidance,
with the answer circled in red and highlighted below:
ASC Research Assignment 6
In the screenshot above, 250 – 10 – 45 – 17 describes the treatment for a “Change in Accounting
Estimate” and 250 – 10 – 45 – 18 directly responds to the example research question.
250 – 10 – 45 – 17 A change in accounting estimate shall be accounted for in the period of
change if the change affects that period only or in the period of change and
future periods if the change affects both. A change in accounting estimate
shall not be accounted for by restating or retrospectively adjusting amounts
reported in financial statements of prior periods.
250 – 10 – 45 – 18 Distinguishing between a change in an accounting principle and a change in
an accounting estimate is sometimes difficult. In some cases, a change in
accounting estimate is effected by a change in accounting principle. One
example of this type of change is a change in method of depreciation. The
new depreciation method is adopted in recognition of a change in the
estimated future benefits inherent in the asset or the pattern of
consumption of those benefits. The effect of the change in accounting
principle may be inseparable from the effect of the change in accounting
estimate. Changes of that type often are related to the continuing process
of obtaining additional information and revising estimates and, therefore,
shall be considered CHANGES in ESTIMATE.
End of ASC Overview