When a company borrows funds for the purpose of acquiring or constructing a qualifying asset, it incurs interest costs. ASC 520-10-25, Borrowing Costs - Overall - Recognition, provides guidance on the capitalization of interest costs in a company's financial statements. This article explains the capitalization of interest costs transaction under ASC 520-10-25, along with illustrative journal entries.
The Accounting Standards Codification (ASC) Topic 960, Plan Accounting, governs the financial reporting standards for employee benefit plans, including defined benefit pension plans. Specifically, ASC 960-20 focuses on the measurement of defined benefit pension plan obligations and the related actuarial assumptions. In this article, we will discuss the actuarial assumptions used in the valuation of a defined benefit pension plan's obligations, the importance of these assumptions, and the journal entries involved in the accounting process.
When companies issue equity securities to raise capital, they often incur costs associated with the issuance process. ASC 505-10, Equity - Overall, provides guidance on the accounting treatment of equity issuance costs in a company's financial statements. This article explains equity issuance costs transactions under ASC 505-10, along with illustrative journal entries.
The accounting standards for health care entities are governed by the Accounting Standards Codification (ASC) 954, a part of the Financial Accounting Standards Board (FASB) framework. The ASC 954 establishes the financial reporting standards for organizations that operate within the health care sector, including hospitals, nursing homes, and ambulatory care facilities. One of the critical components of these financial statements is the patient service revenue and the adjustments required to account for contractual allowances, bad debt, and third-party settlements. This article aims to provide a comprehensive understanding of patient service revenue adjustment transactions and the related journal entries in the …
Accounting Standards Codification (ASC) Topic 950, "Financial Services - Title Plant," provides guidance on accounting for title plant development costs in the title insurance industry. A title plant is a database containing records of real estate transactions and other information used by title insurance companies to determine the insurability of a property's title. The development of a title plant involves compiling and organizing historical records, which can be costly and time-consuming. Proper accounting for title plant development costs is essential to accurately reflect the financial position and performance of title insurance companies. This article will explain the concept of title …