Exam (elaborations)
LOMA 361 QUESTIONS WITH CORRECT ANSWERS 2024
- Course
- Institution
Exam of 6 pages for the course LOMA at LOMA (LOMA 361)
[Show more]
Content preview
LOMA 361Accounts increased by debits - answer Assets
Expenses
(the DEA)
Accounts increased by credits - answer Liabilities
Owners' Equity
Revenues
Contingency Risks - answer C-1 = asset risk
C-2 = pricing risk
C-3 = interest-rate risk
C-4 = general management risk
(A PIG)
Difference in GAAP vs. Statutory accounting - answer GAAP lists cash first on
balance sheet.
GAAP uses "Retained Earnings" as a capital account.
GAAP allows expenses to be recognized over time (i.e. "Deferred Acquisition Costs").
GAAP requires an Annual Report.
GAAP allows "Prepaid Expenses" as short-term assets.
GAAP does not allow modification of actuarial assumptions for reserves.
GAAP reserves calculated with "realistic" mortality, interest and withdrawal rates (with
PADs).
GAAP reserves smaller.
GAAP includes PV of policyowner dividends in policy reserves.
GAAP accounts for interest and principal on short-term and long-term debt separately.
GAAP Capital and Surplus accounts = "Additional Paid-In Capital" and "Retained
Earnings"
GAAP considers "Surplus Notes" a liability account.
GAAP recognizes investment income on an accrual basis
Record of a purchase of an asset: - answer "Asset A".......$$$
"Cash" and/or "Accts Payable--Asset A".......$$$
Record of a sale of an asset: - answer "Cash" and/or "Accts Receivable--Asset
A"........$$$
, Asset A ............$$$
Record of a policyowner's use of a dividend to reduce a policy premium: - answer
"Policyowner Divdends Applied to Premiums".......$$$
"Premium Income" ..................$$$
Record of a cash surrender: - answer "Surrenders Paid"....$$$
Cash..............$$$
Record of wavier-of-premium rider use: - answer "Waiver-of-premium benefits".........
$$$
"Premium Income"...............$$$
Record of initial premium payment: - answer "Cash" ....................$$$
"Premium Suspense"..............$$$
Short-term Assets - answer Cash
Cash equivalents (T-bills)
Investment Income Due and Accrued
Deferred Premiums
Uncollected Premiums
Prepaid Expenses (NOT an admitted asset)
Admitted Assets - answer Cash
Cash equivalents
Real estate
Investment income due and accrued
Deferred premiums
Uncollected premiums
Nonadmitted Assets - answer Furniture
Prepaid expenses (for statutory accounting only)
Personal property
Producer balances due
Record of Nonforfeiture options - answer Cash Surrender: Debit "Surrenders Paid",
Credit "Cash"
Reduced Paid-Up or Extended Term Insurance (w/ outstanding dividends, loans and
interest): Debit "Surrenders Paid" and "Dividend Accumulations", Credit "Policy Loans"
and "Policy Loan Interest"
Reduced Paid-Up or Extended Term Insurance (w/out outstanding dividends, loans and
interest): no entry needed -- just change Master File from premium-paying to paid-up.
Operating Expenses - answer Taxes
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller julianah420. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $19.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
60281 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now