Intermediate Accounting Volume 1, 11th Canadian Edition by Bruce J. McConomy; Donald E. Kieso – Test Bank

Intermediate Accounting Volume 1, 11th Canadian Edition by Bruce J. McConomy; Donald E. Kieso – Test Bank

CHAPTER 11

DEPRECIATION, IMPAIRMENT, AND DISPOSITION CHAPTER STUDY OBJECTIVES

1. Understand the importance of depreciation, impairment, and disposition from a business perspective. The economic benefits of property, plant, and equipment are typically consumed as the items are used by the organization. Because the benefits are consumed over multiple periods, companies use depreciation to allocate the benefits of the PP&E to each period as the capacity of the assets is used up. By allocating the cost of property, plant, and equipment over its useful life, businesses are better able to match the costs and benefits of the assets to the revenues that they help generate. Companies also need to assess their PP&E each year under IFRS for indications of impairment, and if these indications are present, they should re-estimate how much will be recoverable. Following GAAP should also help companies better understand their business. 2. Explain the concept of depreciation and identify the factors to consider when determining depreciation charges. Depreciation is the process of allocating the cost of property, plant, and equipment assets in a systematic and rational manner to the periods that are expected to benefit from their use. The allocation of the cost of intangible capital assets is termed “amortization” and the allocation of the costs of mineral resource assets is termed “depletion.” Four factors involved in determining depreciation expense are (1) the recognition of the appropriate asset components, (2) the amount to be depreciated (depreciable amount), (3) the estimated useful life, and (4) the pattern and method of depreciation. 3. Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. The depreciation method chosen should amortize an asset in a pattern and at a rate that corresponds to the benefits received from that asset. The choice often involves the use of professional judgement. Tax reporting, simplicity, perceived economic consequences, and impact on ratios are examples of factors that influence such judgements in practice. The straight-line method assumes that an asset provides its benefits as a function of time. As such, cost less residual value is divided by the useful life to determine the depreciation expense per period. The decreasing charge method provides for a higher depreciation charge in the early years and lower charges in later periods. For this method, a constant rate (such as double the straight-line rate) is multiplied by the net book value (cost less accumulated depreciation and accumulated impairment losses) at the start of the period to determine each period’s expense. The main justification for this approach is that the asset provides more benefits in the earlier periods. The activity method assumes that the benefits provided by the asset are a function of use instead of the passage of time. The asset’s life is considered in terms of either the output that it provides or an input measure, such as the number of hours it works. The depreciation charge per unit of activity (depreciable amount divided by estimated total units of output or input) is calculated and multiplied by the units of activity produced or consumed in a period to determine the depreciation. 4. Explain the accounting issues for depletion of mineral resources. After the depletion base has been established through accounting decisions related to the acquisition, exploration and evaluation, development, and restoration obligations associated with mineral resources, these costs are allocated to the natural resources that are removed. Depletion is normally calculated using the unit of production method. In this approach, the resource’s cost less residual value, if any, is divided by the number of units that are estimated to be in the resource deposit, to obtain a cost per unit of product. The cost per unit is then multiplied by the number of units withdrawn in the period to calculate the depletion. 5. Explain and apply the accounting procedures for partial periods and a change in depreciation rate. Because all the variables in determining depreciation are estimates—with the exception, perhaps, of an asset’s original cost—it is common for a change in those estimates to result in a change in the depreciation amount. When this occurs, there is no retroactive change and no catch-up adjustment. The change is accounted for in the current in the current and future periods. 6. Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. A capital asset is impaired when its carrying amount is not recoverable. The cost recovery method (ASPE) defines recoverable as the undiscounted cash flows from the asset’s use and later disposal. If impaired, the asset is written down to its fair value, and this loss cannot be reversed later if the asset’s value recovers. The rational entity model (IFRS) defines recoverable amount as the higher of the asset’s value in use and fair value less costs of disposal. Both these values are discounted cash flow amounts. If the recoverable amount subsequently improves, the impairment losses recognized are reversed. 7. Account for derecognition of property, plant, and equipment and explain and apply the accounting standards for long-lived assets that are held for sale. Assets held for sale are no longer depreciated. They are Re-measured to their fair value less costs of disposal at each statement of financial position date. Recoveries in value may be recognized to the extent of previous losses. Held-for-sale items of property, plant, and equipment are separately reported as non-current assets unless they meet the definition of current assets. Under ASPE, assets held for sale are only permitted to be reported in current assets if sold before the financial statements are completed and the proceeds on sale are expected within 12 months from the date of the statement of financial position (or operating cycle, if longer). Depreciation continues for PP&E assets until they are classified as held for sale or derecognized. At the date of disposal, all accounts related to the retired asset are removed from the books. Gains and losses from the disposal of plant assets are shown on the income statement in income before discontinued operations, unless the conditions for reporting as a discontinued operation are met. For property, plant, and equipment donated to an organization outside the reporting entity, the donation is reported at its fair value with a gain or loss on disposal recognized. 8. Describe the types of disclosures required for property, plant, and equipment. The type of information required to be disclosed for property, plant, and equipment is governed by the information needs of users. Because users of private entities’ financial information are often able to seek further specific information from a company, there are fewer required disclosures than for public companies reporting under IFRS. The required disclosures under IFRS include those relating to measurement, changes in account balances and the reasons for the changes, information about how fair values are determined, and many others. 9. Analyze a company’s investment in assets. The efficiency of use of a company’s investment in assets may be evaluated by calculating and interpreting the asset turnover rate, the profit margin, and the rate of return on assets. 10. Identify differences in accounting between IFRS and ASPE, and what changes are expected in the near future. In most major ways, international and Canadian accounting standards for the depreciation of property, plant, and equipment are similar. Significant differences do exist, however, in the extent of componentization for depreciation, the impairment models applied, and the extent of disclosure. The impairment differences relate to how it is determined whether an asset is impaired, how the impairment is measured, and the ability to recognize recoveries in value. 11. Calculate capital cost allowance in routine and non-routine situations. “Capital cost allowance” (CCA) is the term used for depreciation when calculating taxable income in income tax returns. The CCA method is similar to the declining-balance method except that rates are specified for asset classes and the amount claimed is based on year-end balances. The half-year rule is applied to net additions in the year, which means that only 50% of the normal rate is permitted. For an asset class, retirements are accounted for under specific rules that govern the calculation of taxable income. Capital gains occur if the proceeds on disposal are more than the asset’s original cost. When an asset class is eliminated, a terminal loss or recapture of capital cost allowance can occur.   Multiple Choice—Conceptual Answer No. Description d 1. Knowledge of depreciation accounting c 2. Factors in depreciation accounting b 3. Definition of componentization c 4. Asset’s useful life b 5. Depreciation commencement or continuation c 6. Graphic depiction of straight-line and declining-balance methods b 7. Disadvantage of using straight-line method a 8. Depreciation as variable expense d 9. Units of production depreciation a 10. Units of production depreciation b 11. Time based depreciation d 12. Knowledge of double declining-balance method c 13. Effect of accelerated depreciation on the income statement a 14. Classification of depletion expense d 15. Depletion expense method b 16. Definition of liquidating dividend c 17. Revision of depreciation a 18. Disclosure of changes in depreciation c 19. ASPE requirements for impairment b 20. IFRS requirements for impairment d 21. Indicators of asset impairment a 22. Cost recovery impairment model d 23. Rational entity impairment model b 24. Definition of cash generating unit (CGU) a 25. Journal entry for impairment loss under ASPE d 26. Assets held for sale b 27. Discontinuation of depreciation a 28. Loss on sale of asset b 29. Accounting treatment for gain under involuntary conversion d 30. Depreciation cessation b 31. Asset turnover ratio c 32. Rate of return on assets c 33. PP&E disclosures c *34. Objectives of CCA method d *35. Factors to consider for CCA *This topic is dealt with in an Appendix to the chapter. Multiple Choice—Computational Answer No. Description c 36. Componentization of assets c 37. Calculate depreciation using double declining-balance. b 38. Calculate depreciation using double declining-balance. b 39. Double declining-balance method d 40. Calculate book value of asset. c 41. Calculate depreciation using straight-line. a 42. Calculate acquisition cost from straight-line depreciation. d 43. Calculate acquisition cost from units of production. d 44. Calculate depreciation expense. d 45. Calculate depreciation expense using double declining-balance. c 46. Calculate accumulated depreciation using units of production. b 47. Calculate depreciation using double declining-balance. b 48. Calculate accumulated depreciation using straight-line. a 49. Calculate depreciation using double declining-balance. b 50. Calculate depreciation using double declining-balance. c 51. Calculate accumulated depreciation using double declining-balance. c 52. Calculate units-of-production depletion expense. c 53. Calculate depletion expense. c 54. Units-of-production depletion expense c 55. Calculate revised depreciation expense. a 56. Calculate revised depreciation expense after major overhaul. b 57. Calculate loss on sale. a 58. Calculate loss on disposal. b 59. Calculate recoverable amount. d 60. Proper accounting treatment for impairment loss a 61. Depreciation on asset held for sale b 62. Fair value adjustment on equipment held for sale d 63. Calculate depreciation expense from change in contra-asset account. b 64. Calculate depreciation expense from change in contra-asset account. c 65. Calculate gain for held for sale assets. c 66. Calculate gain on sale. c 67. Calculate asset turnover ratio. b 68. Calculate rate of return on assets. a 69. Calculate asset turnover ratio. b 70. Calculate profit margin ratio. c 71. Calculate rate of return on assets. c *72. Calculate CCA for the year. b *73. Calculate CCA for the year. d *74. Calculate recapture or terminal loss on sale. *This topic is dealt with in an Appendix to the chapter.   Exercises Item Description E11-75 Componentization and depreciation of PP&E assets E11-76 Definitions *E11-77 Calculate depreciation and CCA. *E11-78 Calculate depreciation and CCA. E11-79 True or false E11-80 Asset depreciation and disposition E11-81 Rational entity impairment model E11-82 Impairment PROBLEMS Item Description *P11-83 Calculate depreciation and CCA. P11-84 Cost recovery impairment model, revision of depreciation P11-85 Calculation of ratios. *This topic is dealt with in an Appendix to the chapter. MULTIPLE CHOICE—Conceptual 1. Which of the following is INCORRECT regarding depreciation? a) It is not a matter of valuation. b) It is part of the matching of revenues and expenses. c) It is a means of cost allocation. d) It is an attempt to reflect the fair market values of the related assets. Answer: d Difficulty: Easy Learning Objective: Understand the importance of depreciation, impairment, and disposition from a business perspective. Section Reference: The Importance of Depreciation, Impairment, and Disposition from a Business Perspective CPA: Financial Reporting Bloomcode: Knowledge 2. Factors to consider in the depreciation process do NOT include a) the asset’s depreciable amount. b) the period over which to depreciate the asset. c) the asset’s fair market value. d) which asset components should be depreciated separately. Answer: c Difficulty: Easy Learning Objective: Explain the concept of depreciation and identify the factors to consider when determining depreciation charges. Section Reference: Factors Considered in the Depreciation Process CPA: Financial Reporting Bloomcode: Knowledge 3. Deciding which PPE components to depreciate separately is called a) separate depreciation. b) componentization. c) group depreciation. d) individual asset depreciation. Answer: b Difficulty: Easy Learning Objective: Explain the concept of depreciation and identify the factors to consider when determining depreciation charges. Section Reference: Factors Considered in the Depreciation Process CPA: Financial Reporting Bloomcode: Knowledge 4. An asset’s useful life a) remains unchanged once it has been determined. b) is the same as its physical life. c) is affected by physical and economic factors. d) is not affected by physical and economic factors. Answer: c Difficulty: Easy Learning Objective: Explain the concept of depreciation and identify the factors to consider when determining depreciation charges. Section Reference: Factors Considered in the Depreciation Process CPA: Financial Reporting Bloomcode: Comprehension 5. Depreciation commences or continues when a) The asset has been paid for. b) The asset is available for use. c) The asset’s fair value can be recovered. d) The asset is taken out of service. Answer: b Difficulty: Easy Learning Objective: Explain the concept of depreciation and identify the factors to consider when determining depreciation charges. Section Reference: Factors Considered in the Depreciation Process CPA: Financial Reporting Bloomcode: Knowledge 6. A graph is set up with “yearly depreciation expense” on the vertical axis and “time” on the horizontal axis. Assuming linear relationships, how would the graphs for straight-line and declining-balance depreciation, respectively, be drawn? a) vertically and sloping down to the right b) vertically and sloping up to the right c) horizontally and sloping down to the right d) horizontally and sloping up to the right Answer: c Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 7. A principal objection to the straight-line method of depreciation is that it a) provides for the declining productivity of an aging asset. b) ignores variations in the rate of asset use. c) tends to result in a constant rate of return on a diminishing investment base. d) gives smaller periodic write-offs than decreasing charge methods. Answer: b Difficulty: Medium Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 8. For income statement purposes, depreciation is a decreasing expense if the depreciation method used is a) units of production. b) straight-line. c) increasing charge. d) declining-balance. Answer: c Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 9. If a company uses the units of production method for calculating depreciation on its factory machinery, the credit to accumulated depreciation from period to period during the life of the firm will a) be constant. b) vary with unit sales. c) vary with sales revenue. d) vary with production. Answer: d Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 10. When the unit of production method of depreciation is used, which of the following best describes depreciation expense? a) Depreciation expense will vary directly with output. b) Depreciation expense will vary directly with sales. c) Depreciation rate per unit will vary directly with output. d) Depreciation rate per unit will vary directly with sales. Answer: a Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 11. Which of the following is NOT a time-based depreciation method? a) straight-line b) units of production c) double-declining balance d) any diminishing balance method Answer: b Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Knowledge 12. Which of the following does NOT apply to the declining-balance method? a) It results in a decreasing charge to depreciation expense. b) Residual value is not deducted in calculating the depreciation base. c) The book value should not be reduced below residual value. d) In certain circumstances, the book value may be reduced below residual value. Answer: d Difficulty: Easy Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Knowledge 13. If income tax effects are ignored, accelerated depreciation methods a) provide funds for the earlier replacement of assets. b) increase funds provided by operations. c) tend to offset the effect of steadily increasing repair and maintenance costs on the income statement. d) tend to decrease the current ratio. Answer: c Difficulty: Medium Learning Objective: Identify how depreciation methods are selected; calculate and recognize depreciation using the straight-line, decreasing charge, and activity methods. Section Reference: Depreciation—Methods of Allocation and Calculation CPA: Financial Reporting Bloomcode: Comprehension 14. Depletion expense a) is usually part of cost of goods sold. b) includes tangible equipment costs in the depletion base. c) excludes intangible development costs from the depletion base. d) excludes restoration costs from the depletion base. Answer: a Difficulty: Easy Learning Objective: Explain the accounting issues for depletion of mineral resources. Section Reference: Depletion of Mineral Resources CPA: Financial Reporting Bloomcode: Knowledge 15. The most common method of recording depletion for accounting purposes is the a) single-declining method. b) double-declining method. c) straight-line method. d) units of production method. Answer: d Difficulty: Easy Learning Objective: Explain the accounting issues for depletion of mineral resources. Section Reference: Depletion of Mineral Resources CPA: Financial Reporting Bloomcode: Knowledge 16. When all or a portion of shareholders’ capital investments are returned to them, this is called a a) return dividend. b) liquidating dividend. c) stock dividend. d) investment dividend. Answer: b Difficulty: Medium Learning Objective: Explain the accounting issues for depletion of mineral resources. Section Reference: Depletion of Mineral Resources CPA: Financial Reporting Bloomcode: Knowledge 17. On January 1, 2012, Rabbit Corp. acquired machinery which it depreciated using the straight-line method with an estimated useful life of fifteen years and no residual value. On January 1, 2017, Rabbit estimated that the remaining life of this machinery was six years with no residual value. This change should be accounted for a) as a prior period adjustment. b) as the cumulative effect of a change in accounting principle in 2017. c) by setting future annual depreciation equal to one-sixth of the book value on January 1, 2017. d) by continuing to depreciate the machinery over the original fifteen year life. Answer: c Difficulty: Medium Learning Objective: Explain and apply the accounting procedures for partial periods and a change in depreciation rate. Section Reference: Other Depreciation Issues CPA: Financial Reporting Bloomcode: Analysis 18. Changes in the depreciation rate are accounted for as a(n) a) adjustment to current and future periods. b) adjustment to the current period only. c) adjustment to future periods only. d) catch-up adjustment to prior periods. Answer: a Difficulty: Medium Learning Objective: Explain and apply the accounting procedures for partial periods and a change in depreciation rate. Section Reference: Other Depreciation Issues CPA: Financial Reporting Bloomcode: Knowledge 19. ASPE requires that assets must be assessed for indications of impairment a) at the end of each reporting period. b) at the end of every quarter. c) when events and circumstances indicate that asset’s carrying amount may not be recoverable. d) whenever the method of depreciation has changed. Answer: c Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Knowledge 20. IFRS require that assets must be assessed for indications of impairment a) at the end of every quarter. b) at the end of each reporting period. c) when events and circumstances indicate that asset’s carrying amount may not be recoverable. d) whenever the method of depreciation has changed. Answer: b Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Knowledge 21. Which of the following is NOT likely to be an indicator of possible asset impairment? a) evidence of obsolescence or physical damage b) a significant decrease in the asset’s market value c) the book value of the entity’s net assets is greater than the entity’s market capitalization d) costs incurred for asset acquisition or construction are significantly lower than originally expected Answer: d Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment Bloomcode: Knowledge 22. The cost recovery impairment model a) uses undiscounted cash flows in its determination of impairment. b) uses discounted cash flows in its determination of impairment. c) is the method used under IFRS. d) requires the calculation of value in use. Answer: a Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Knowledge 23. The rational entity impairment model a) does not allow the reversal of previously recognized impairment losses. b) is the method used under ASPE. c) uses undiscounted cash flows in its determination of impairment. d) compares the asset’s carrying value with its recoverable amount. Answer: d Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Knowledge 24. Which of the following best describes the concept of cash-generating units (CGU)? a) Their cash flows are dependent on those of other CGU’s. b) The individual assets that are included in the CGU do not generate cash flows on their own. c) A CGU is the largest identifiable group of assets that generate cash inflows predominantly independent from other CGUs. d) IFRS does not recognize the concept of cash-generating units (CGU). Answer: b Difficulty: Medium Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Comprehension 25. For a company that uses ASPE, the required year-end journal entry to record an impairment loss includes a) a debit to Loss on Impairment and a credit to Accumulated Impairment Losses. b) a debit to Other Comprehensive Income and a credit to Accumulated Impairment Losses. c) a debit to Loss on Impairment and a credit to the related asset. d) a debit to Other Comprehensive Income and a credit to the related asset. Answer: a Difficulty: Easy Learning Objective: Explain the issues and apply the accounting standards for capital asset impairment under both IFRS and ASPE. Section Reference: Impairment CPA: Financial Reporting Bloomcode: Knowledge 26. Long-lived assets that are held for sale a) continue to be depreciated. b) are carried at the higher of book value and fair values less costs of disposal. c) are generally not re-measured at each balance sheet date. d) are reported separately from other assets. Answer: d Difficulty: Medium Learning Objective: Account for derecognition of property, plant, and equipment and explain and apply the accounting standards for long-lived assets that are held for sale. Section Reference: Long-Lived Assets to Be Disposed of by Sale CPA: Financial Reporting Bloomcode: Knowledge 27. Depreciation should be discontinued when an asset has been a) derecognized or taken out of service. b) derecognized or classified as held for sale. c) taken out of service. d) taken out of service or classified as held for sale. Answer: b Difficulty: Medium Learning Objective: Account for derecognition of property, plant, and equipment and explain and apply the accounting standards for long-lived assets that are held for sale. Section Reference: Long-Lived Assets to Be Disposed of by Sale CPA: Financial Reporting Bloomcode: Knowledge 28. The sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale were a) less than book value. b) greater than cost. c) greater than book value. d) less than current market value. Answer: a Difficulty: Medium Learning Objective: Account for derecognition of property, plant, and equipment and explain and apply the accounting standards for long-lived assets that are held for sale. Section Reference: Long-Lived Assets to Be Disposed of by Sale CPA: Financial Reporting Bloomcode: Comprehension 29. One of Cheetah Corp.’s assets was expropriated by government authorities. The following additional information is available: Book value at the time of expropriation $1,200,000 Cash received $3,000,000 Under ASPE, this situation would be reflected in the company’s financial statements as a $1,800,000 a) gain that would be included in other comprehensive income. b) gain that would be included in net income. c) gain from discontinued operations. d) gain that would appear on the statement of shareholders’ equity. Answer: b Difficulty: Medium Learning Objective: Account for derecognition of property, plant, and equipment and explain and apply the accounting standards for long-lived assets that are held for sale. Section Reference: Long-Lived Assets to Be Disposed of by Sale CPA: Financial Reporting Bloomcode: Application 30. A general description of the depreciation methods applicable to major classes of depreciable assets a) is not a current practice in financial reporting. b) is not essential to a fair presentation of financial position. c) is needed in financial reporting when company policy differs from income tax policy. d) should be included in corporate financial statements or notes thereto. Answer: d Difficulty: Medium Learning Objective: Describe the types of disclosures required for property, plant, and equipment. Section Reference: Presentation and Disclosure CPA: Financial Reporting Bloomcode: Knowledge 31. The asset turnover ratio is calculated by dividing a) net income by ending total assets. b) net sales by average total assets. c) net sales by ending total assets. d) net income by average total assets. Answer: b Difficulty: Easy Learning Objective: Analyze a company’s investment in assets. Section Reference: Analysis CPA: Financial Reporting Bloomcode: Knowledge 32. The rate of return on assets (ROA) is calculated by dividing a) average total assets by net income. b) net revenue by average total assets. c) net income by average total assets. d) net income by net revenue. Answer: c Difficulty: Easy Learning Objective: Analyze a company’s investment in assets. Section Reference: Analysis CPA: Financial Reporting Bloomcode: Knowledge