Case Study: FASB Codification Case
Question 1: Access the FASB Codification and prepare responses to the following questions, providing Codification references as support for your answers. Access the glossary and give the definition for:
A. Firm Fixed-Price Contract – A Fixed Price Contract is essentially a contract where an adjustment can’t be made because of the cost experience of the contractor or his or her ...view middle of the document...
B. Amortized Cost – Amortized Cost is where the sum of the initial investment minus the cash collected then minus the write-downs plus yield accreted to date. (FASB, 2012). So in another words, an Amortized Cost for a company, for example, is the cost of an asset that is written off as an asset that has depreciated in value. It represents the total accumulated depreciation, and thus the totally amortization, to date.
C. Impairment – Impairment is the situation where an asset carries an amount that exceeds it fair market value. (FASB, 2012). So in another words, impairment is when an asset with a long lifespan is overpriced.
Question 2: Are there SEC documents as a part of this Codification? If yes, where are they located?
A. Was unable to locate any SEC documents for this Codification.
B. Yes there are SEC documents as part of this codification, entitled Rule 2a-7 under the Investment Company Act of 1940 Provisions. Located at: http://www.sec.gov/divisions/investment/icvaluation.htm
C. Yes there are SEC documents as part of this codification, entitled 17 CFR Part 211. Located at: http://www.sec.gov/interps/account/sab100.htm