Question

Question 1 (15 POINTS)

The FASB recently released the following two AccountingStandards Updates (ASU) and an ASC, as listed below

:

ASU 2014-08, “Reporting of DiscontinuedOperations and Disclosures of Disposals of Components ofEntities”

ASU 2015-01, “Simplifying Income StatementPresentation by Eliminating the Concept of Extraordinary Items”and

ASC 606 “Revenue Recognition Standard ( May2014)

For each of these, answer the following questions (can useCodification site to refer to standards):

a) Why did the FASB issue this ASU/ ASC (i.e., how is it animprovement)?

b) What are the main provisions of the ASU/ASC and how are thesedifferent from current GAAP?

Question 2: What are accounting changes and whyis it an issue? List and define the three types of accountingchanges. Include in which statement the changes are presented andwhere in the statement. (5 POINTS)

Question 3: Under current US GAAP (ASU2011-05): (10 POINTS)

a) What is meant by Comprehensive Income?

b) How should Comprehensive Income be presented in the financialstatements?

Questions 4: How is fair value definedin SFAS No. 157 (5 POINTS)