1. Each year there are companies that have trouble paying debt coming due and they and the creditor change the payment terms debt restructure. How do we account for a debt restructure in instances whereby the future debt and interest payments under the new terms of the debt agreement are reduced to a point where the total to be paid is less than the total amount owed today? How to we account for a debt restructure when future payments are reduced but total future principal and interest payments are greater than the amount owed today?
2. Many times, companies use accelerated depreciation on equipment for tax purposes and the straight line method for financial reporting. In such instances how, in the first year of the assets life, do we compute tax expense on the financial statements and how do we account for the difference between that tax expense and the income tax actually paid for the year? What happens later in the assets life?
3. When companies have a period of operating losses and thus report negative taxable income how are the income tax consequences on the financial statements reported when a tax carryback is used? How are the income tax consequences on the financial statements reported when a tax carryforward is used?