Week 4 Hw

In: Business and Management

Submitted By kaberni
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Week 2 Case Study

1) Firm Fixed-Price Contract: A contract in which the price is not subject to any adjustment by reason of the cost experience of the contractor or his performance under the contract (FASB 2012).

References to Firm Fixed-Price Contract are under the Revenue Codification. Revenue/Topic 605 Revenue Recognition/35 Construction-Type and Production-Type Contracts

I did not locate any SEC documents relating directly to Firm Fixed-Price Contract but Topic 605 Revenue Recognition does house some SEC publications. 605 Revenue Recognition/10 Overall/S99 SEC Materials. The SEC requires public companies to recognize revenue when it is realized, such as at delivery or shipment of goods depending on the appropriate incoterm. Alternatively the performance of services would be considered revenue-earning. A firm fixed-price contract would indicate that the revenue amount is pre-determined by the contract price, which cannot be altered.

2) Amortized Cost: The sum of the initial investment less cash collected less write-downs plus yield accreted to date (FASB 2012).

There are no links to Amortized Cost within the Codification. Amortized Cost is referred to in some subtopics relating to Subsequent Measure General, such as: Topic 954/Health Care Entities/325 Investments/35 Subsequent Measurement General and Topic 944 Financial Services-Insurance/310 Receivables/35Subsequent Measurement General.

I did not locate any SEC docs as part of this Codification.

3) Impairment: Impairment is the condition that exists when the carrying amount of a long-lived asset (asset group) exceeds its fair value (FASB 2012). Impairment refers specifically to Topic 360: Plant, Property and Equipment. There are are SEC docs located under 360 Property, Plant and Equipment/10 Overall/S99 SEC Materials.
Within the SEC materials S99-2 discusses impairments. The goal of the…...

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