CRAM NOTES

Question 1

When you have a loss or gain on equity and receive dividends - FV method

Answer 1

You either net them against or with each other

Question 2

Goodwill method partnership

Answer 2

When a new partner’s asset contribution is greater than the ownership interest s/he is to receive, the excess assets are accounted for as goodwill attributable to the old partners.

Question 3

Governmental Statement of Cashflows

Answer 3

• Noncapital financing activities: borrowing money not for construction
• Capital & related financing activities: proceeds from shit directly related to capital assets
• Investing activities:making and collecting loans (except program loans) and acquiring and disposing of debt or equity instruments