1) Describe the tax treatment of partnership income.
2) Describe the attitude of the FASB toward the IASB (International Accounting
Standards Board).
3) Distinguish between an expense and an expenditure.
4) ABC Corporation purchased 10,000 shares(80%) of EZ Company at $35 per share
and sold them several years later for $35 per share. The consolidated income statement
reports a loss on the sale of this investment. Explain.same share price – need to adjust
5) The following events affected the New Athens University Loan Fund:
1>$300,000 is received from a donor to establish a student loan fund. Loans will carry a
6% annual interest rate.
2>The Loan Fund loaned the $300,000 to students. Five percent of the loans are
estimated to be uncollectible.
3>Loans of $50,000 were repaid with $3,000 of interest.
4>A $1,000 student loan was written off as uncollectible.
Required:
Prepare the journal entries necessary to record these transactions.
6) Is the economic entity or the parent concept more consistent with the principles
addressed in the FASBs conceptual framework? Explain your answer.
7) What is the purpose of a realization and liquidation account?
8) What fund is used to account for the library books owned by a university? How
should depreciation of the library books be reflected in the financial statements of the
university?