Wiley GAAP 2019

45ASC 720 OTHER EXPENSES

PERSPECTIVE AND ISSUES

Subtopics

ASC 720, Other Expenses, contains nine subtopics:

• ASC 720-10, Overall, which merely lists the other subtopics
• ASC 720-15, Start-Up Costs
• ASC 720-20, Insurance Costs
• ASC 720-25, Contributions Made
• ASC 720-30, Real and Personal Property Taxes
• ASC 720-35, Advertising Costs
• ASC 720-40, Electronic Equipment Waste Obligations
• ASC 720-45, Business and Technology Reengineering
• ASC 720-50, Fees Paid to the Federal Government by Pharmaceutical Manufacturers and Health Insurers

Technical Alert

ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers.

In December 2016, the FASB issued an ASU that made technical corrections and improvements to ASC 606 and several other topics. The revenue standard superseded most of ASC 340-20, Other Asset and Deferred Costs and created the new subtopic ASC 340-40. That subtopic contains new cost capitalization guidance. In the process, the revenue standard inadvertently superseded the ASC 340-20 guidance on when to recognize a liability. To rectify that oversight, ASU 2016-20 reinstates the guidance on the accrual of advertising costs and moves it to ASC 720-35, Other Expenses—Advertising Costs

Guidance.

The ASU amends the scope section to include costs related to direct-response advertising activities, which exclude advertising directed to an audience that could not be shown to have responded to the advertising. (ASC 720-35-15-5)

The guidance ...