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.
In the course of conducting business, companies may encounter situations where the tax treatment of certain items is uncertain. ASC 740-10, Income Taxes - Overall, provides guidance on accounting for uncertain tax positions in a company's financial statements. This article explains uncertain tax positions transactions under ASC 740-10, along with illustrative journal entries.
Accounting Standards Codification (ASC) Topic 965, Plan Accounting, covers the financial reporting requirements for health and welfare benefit plans. These plans are designed to provide participants with benefits such as medical, dental, and disability coverage. ASC 965-20 specifically focuses on the measurement of plan expenses and the accounting treatment for these expenses. This article will discuss the various types of plan expenses, their significance in health and welfare benefit plans, and the journal entries used to record these transactions.
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.
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.