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Accounting for Deferred-Payment Notes.

Richard L. Rogers; Krishnagopal Menon
The Accounting Review 1985 60(3), 547-557
This article discusses the accounting implications of a new type of financial security introduced on the European bond market. The security, known as a deferred-payment note, allows the investor to acquire a note by paying a portion of the issue price at the time of issuance. The remaining amount is required to be paid in a second installment due some months later. Alternative accounting treatments are presented. These treatments are evaluated in light of the FASB's conceptual framework pronouncements. The paper concludes that the FASB's current position fails to provide appropriate guidelines which the profession can use to resolve this new financial reporting issue.

Characteristics of Dollar-Unit Taints and Error Rates in Accounts Receivable and Inventory.

John Neter; Johnny R. Johnson; Robert A. Leitch
The Accounting Review 1985 60(3), 488-499
This note extends the analysis of line-item error taints and error rates originally presented in Johnson, Leitch and Neter [1981] by first considering the distribution of dollar-unit taints, the relevant distribution when simple random sampling is applied to monetary units. Next, empirical evidence on the relation between the taint amount and book amount is presented. Finally, empirical findings on the magnitudes of dollar-unit error rates are provided.