Discussion Questions Assignment Example | Topics and Well Written Essays - 250 words - 10

Discussion Questions - Assignment Example Unearned revenue is recognized as an asset and liability. But when the service has been provided for it is then recognized as an earned revenue. They issue bond in order to help them obtain a long term finance. I would rather buy the bond at a discount because it will be cheap with a higher interest rate. The determining factor is the interest rate reflected in the market. It is a method that spreads the discount evenly over the periods during which interest is paid. When dealing with bonds payable, it involves crediting interest expense and debiting on bond payable. It also spreads the premium evenly over the months. The number of months the bind is held is divided by the number of months from the beginning of the tax period to the maturity date. The result is then multiplied by the bond premium, which is a reduced amount each year. This is because of the bond amortization form earlier years which also helps in calculation of the premium each year They are both treated as liabilities. Notes payable are recorded by the company as a liability while the other party, for example a bank, records the entry as notes receivable. Then the company makes another entry, debiting the interest expense and crediting the interest payable. On the other hand for accounts payable the company do not accrue any interest. Therefore the creditors recognize it in their books as accounts receivable and the company credits its accounts payable. Statement of cash flows enables a company displays information about the inflows (receipts) and outflows (payments) of cash of a company. It includes information about the income statement, balance sheet and the retained earnings statement. It is divided into three ways that tell us on how the company receives and uses its money. Operating section outlines money received from the daily operations of the company. On the other hand, the investment activities section outlines the price