Fasb Statement 86
FASB STATEMENT 86
FASB Statement 86
Accounting 304
Carla LaMariana
11/28/2007
[Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract of the document here. The abstract is typically a short summary of the contents of the document.]
In 1973 a new organization was founded, this organization was named The Financial Ac-counting Standards Board, or the FASB. The FASB creates and improves the standards of the reporting of financial accounting and to guide and educate the general public. When the FASB issues these standards they are considered to be the latest generally ac-cepted accounting principles, otherwise known as GAAP (2007). In 1985 the FASB is-sued accounting statement number 86. Statement number 86 is entitled, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed. The effective date for statement number 86 is the fiscal years that begin after December 15, 1985. Statement number 86 affects FAS 2, paragraph 31, and FIN 6, paragraphs 3, 6 and 8, su-persedes FIN 6, paragraphs 7 and 9 and supersedes FTB 79-2. Statement number 86 is at this time affected by no other pronouncements (Professional Library). Statement 86 covers the handling of computer software that is to be sold, leased, or oth-erwise marketed as a separate or as a part of a product or process,(FASB: Summary of Statement 86) the FASB began the process of developing a standard for the accounting of software due to a moratorium imposed by the SEC and in response to an AICPA Issues Paper entitled, Accounting for Costs of Software For Sale or Lease.(Professional Library) Statement 86 helps clarify the requirements for the costs that should be considered research and development and those costs that should be considered production costs. It is also stated that all costs that are considered research and development should be expensed at the time they occur and all production
FASB Statement 86
Accounting 304
Carla LaMariana
11/28/2007
[Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract of the document here. The abstract is typically a short summary of the contents of the document.]
In 1973 a new organization was founded, this organization was named The Financial Ac-counting Standards Board, or the FASB. The FASB creates and improves the standards of the reporting of financial accounting and to guide and educate the general public. When the FASB issues these standards they are considered to be the latest generally ac-cepted accounting principles, otherwise known as GAAP (2007). In 1985 the FASB is-sued accounting statement number 86. Statement number 86 is entitled, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed. The effective date for statement number 86 is the fiscal years that begin after December 15, 1985. Statement number 86 affects FAS 2, paragraph 31, and FIN 6, paragraphs 3, 6 and 8, su-persedes FIN 6, paragraphs 7 and 9 and supersedes FTB 79-2. Statement number 86 is at this time affected by no other pronouncements (Professional Library). Statement 86 covers the handling of computer software that is to be sold, leased, or oth-erwise marketed as a separate or as a part of a product or process,(FASB: Summary of Statement 86) the FASB began the process of developing a standard for the accounting of software due to a moratorium imposed by the SEC and in response to an AICPA Issues Paper entitled, Accounting for Costs of Software For Sale or Lease.(Professional Library) Statement 86 helps clarify the requirements for the costs that should be considered research and development and those costs that should be considered production costs. It is also stated that all costs that are considered research and development should be expensed at the time they occur and all production
References: Yahoo Finance. http://biz.yahoo.com/e/070403/cwdw.ob10-khtml Retrieved November 24,2007 NYSSCPA.ORG http://www.nysscpa.org/prof_library/fasb/Fasb86htm. Retrieved No-vember 24, 2007 FASB. http://www.fasb.org/pdf/fas86.pdf Retrieved November 18, 2007 FASB: Summary http://www.fasb.org/st/summary/stsum86.shtml Retrieved November 18, 2007 Intermediate Accounting (12th Edition) Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield 2007 John Wiley and Sons, Inc. (pg 8+9)