Question 1

Which of the following should be reported for share capital?

Accepted Answer

A) The shares authorized 
B) The shares issued 
C) The shares outstanding 
D) All of these 
A) The shares authorized 
B) The shares issued 
C) The shares outstanding 
D) All of these

Question 2

Under IFRS a company may use the term "reserve" to include items such as retained earnings, share premium, and accumulated other comprehensive income.

Accepted Answer

A) True 
 B)False

Question 3

Within the statement of financial position companies should separately report all of the following except

Accepted Answer

A) Assets and liabilities with different general liquidity characteristics. 
B) Assets and liabilities that have been financed with different types of instruments. 
C) Assets that differ in their expected function in the company's central operations. 
D) Liabilities that differ in their amounts, timing, and nature. 
A) Assets and liabilities with different general liquidity characteristics. 
B) Assets and liabilities that have been financed with different types of instruments. 
C) Assets that differ in their expected function in the company's central operations. 
D) Liabilities that differ in their amounts, timing, and nature.

Question 4

The statement of cash flows reports only the cash effects of operations during a period and financing transactions.

Accepted Answer

A) True 
 B)False

Question 5

Statement of financial position information is useful for all of the following except to

Accepted Answer

A) compute rates of return 
B) analyze cash inflows and outflows for the period 
C) evaluate capital structure 
D) assess future cash flows 
A) compute rates of return 
B) analyze cash inflows and outflows for the period 
C) evaluate capital structure 
D) assess future cash flows

Question 6

Which of the following is not an acceptable major asset classification?

Accepted Answer

A) Current assets 
B) Investments 
C) Property, plant, and equipment 
D) Deferred charges 
A) Current assets 
B) Investments 
C) Property, plant, and equipment 
D) Deferred charges

Question 7

It is mandatory that the essential provisions of which of the following be clearly stated in the notes to the financial statements?

Accepted Answer

A) Stock option plans 
B) Pension obligations 
C) Lease contracts 
D) All of these 
A) Stock option plans 
B) Pension obligations 
C) Lease contracts 
D) All of these

Question 8

The basis for classifying assets as current or noncurrent is conversion to cash within

Accepted Answer

A) the accounting cycle or one year, whichever is shorter. 
B) the operating cycle or one year, whichever is longer. 
C) the accounting cycle or one year, whichever is longer. 
D) the operating cycle or one year, whichever is shorter. 
A) the accounting cycle or one year, whichever is shorter. 
B) the operating cycle or one year, whichever is longer. 
C) the accounting cycle or one year, whichever is longer. 
D) the operating cycle or one year, whichever is shorter.

Question 9

Free cash flow is calculated as net cash provided by operating activities less

Accepted Answer

A) capital expenditures. 
B) dividends. 
C) capital expenditures and dividends. 
D) capital expenditures and depreciation. 
A) capital expenditures. 
B) dividends. 
C) capital expenditures and dividends. 
D) capital expenditures and depreciation.

Question 10

Pedigo Corporation reports the following information:   Pedigo's cash debt coverage ratio is

Accepted Answer

A) 1.02. 
B) 1.70. 
C) 2.55. 
D) 3.00. 
A) 1.02. 
B) 1.70. 
C) 2.55. 
D) 3.00.

Question 11

The statement of financial position

Accepted Answer

A) Omits many items that are of financial value. 
B) Makes very limited use of judgments and estimates. 
C) Uses fair value for most assets and liabilities. 
D) All of the choices are correct regarding the statement of financial position. 
A) Omits many items that are of financial value. 
B) Makes very limited use of judgments and estimates. 
C) Uses fair value for most assets and liabilities. 
D) All of the choices are correct regarding the statement of financial position.

Question 12

Under IFRS the statement of financial position is often referred to as the statement of changes in equity.

Accepted Answer

A) True 
 B)False

Question 13

Equity or debt securities held to finance future construction of additional plants should be classified on a balance sheet as

Accepted Answer

A) current assets. 
B) property, plant, and equipment. 
C) intangible assets. 
D) long-term investments. 
A) current assets. 
B) property, plant, and equipment. 
C) intangible assets. 
D) long-term investments.

Question 14

Which item below is not a current liability?

Accepted Answer

A) Unearned revenue 
B) Stock dividends distributable 
C) The currently maturing portion of long-term debt 
D) Trade accounts payable 
A) Unearned revenue 
B) Stock dividends distributable 
C) The currently maturing portion of long-term debt 
D) Trade accounts payable

Question 15

IFRS requires specific note disclosures on inventories that are disaggregated into classifications such as merchandise, production supplies, work in process, and finished goods.

Accepted Answer

A) True 
 B)False

Question 16

The statement of financial position is useful for analyzing all of the following except

Accepted Answer

A) liquidity. 
B) solvency. 
C) profitability. 
D) financial flexibility. 
A) liquidity. 
B) solvency. 
C) profitability. 
D) financial flexibility.

Question 17

The net assets of a business are equal to

Accepted Answer

A) current assets minus current liabilities. 
B) total assets plus total liabilities. 
C) total assets minus total shareholders' equity. 
D) none of these. 
A) current assets minus current liabilities. 
B) total assets plus total liabilities. 
C) total assets minus total shareholders' equity. 
D) none of these.

Question 18

If shares-ordinary were issued to acquire an CHF8,000 machine, how would the transaction appear on the statement of cash flows?

Accepted Answer

A) It would depend on whether you are using the direct or the indirect method. 
B) It would be a positive CHF8,000 in the financing section and a negative CHF8,000 in the investing section. 
C) It would be a negative CHF8,000 in the financing section and a positive CHF8,000 in the investing section. 
D) It would not appear on the statement of cash flows but rather on a schedule of noncash investing and financing activities. 
A) It would depend on whether you are using the direct or the indirect method. 
B) It would be a positive CHF8,000 in the financing section and a negative CHF8,000 in the investing section. 
C) It would be a negative CHF8,000 in the financing section and a positive CHF8,000 in the investing section. 
D) It would not appear on the statement of cash flows but rather on a schedule of noncash investing and financing activities.

Question 19

Caroline, Inc.had the following transactions during 2011:   What is Caroline, Inc.'s net cash provided (used) by financing activities?

Accepted Answer

A) £300,000 provided by financing activities. 
B) £24,000 provided by financing activities. 
C) £24,000 used by financing activities. 
D) £214,000 used by financing activities. 
A) £300,000 provided by financing activities. 
B) £24,000 provided by financing activities. 
C) £24,000 used by financing activities. 
D) £214,000 used by financing activities.

Question 20

Kohler Company owns the following investments:   Kohler will report securities in its long-term investments section of

Accepted Answer

A) exactly £95,000. 
B) exactly £107,000. 
C) exactly £142,000. 
D) £82,000 or an amount less than £82,000, depending on the circumstances. 
A) exactly £95,000. 
B) exactly £107,000. 
C) exactly £142,000. 
D) £82,000 or an amount less than £82,000, depending on the circumstances.

Exam 5: Statement of Financial Position and Statement of Cash Flows

Which of the following should be reported for share capital?

Under IFRS a company may use the term "reserve" to include items such as retained earnings, share premium, and accumulated other comprehensive income.

Within the statement of financial position companies should separately report all of the following except

The statement of cash flows reports only the cash effects of operations during a period and financing transactions.

Statement of financial position information is useful for all of the following except to

Which of the following is not an acceptable major asset classification?

It is mandatory that the essential provisions of which of the following be clearly stated in the notes to the financial statements?

The basis for classifying assets as current or noncurrent is conversion to cash within

Free cash flow is calculated as net cash provided by operating activities less

Pedigo Corporation reports the following information: Pedigo's cash debt coverage ratio is

The statement of financial position

Under IFRS the statement of financial position is often referred to as the statement of changes in equity.

Equity or debt securities held to finance future construction of additional plants should be classified on a balance sheet as

Which item below is not a current liability?

IFRS requires specific note disclosures on inventories that are disaggregated into classifications such as merchandise, production supplies, work in process, and finished goods.

The statement of financial position is useful for analyzing all of the following except

The net assets of a business are equal to

If shares-ordinary were issued to acquire an CHF8,000 machine, how would the transaction appear on the statement of cash flows?

Caroline, Inc.had the following transactions during 2011: What is Caroline, Inc.'s net cash provided (used) by financing activities?

Kohler Company owns the following investments: Kohler will report securities in its long-term investments section of

Financial Accounting and Accounting Standards

Conceptual Framework Underlying Financial Accounting

The Accounting Information System

Income Statement and Related Information

Accounting and the Time Value of Money

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Current Liabilities, Provisions, and Contingencies

Non-Current Liabilities

Equity

Dilutive Securities and Earnings Per Share

Investments

Revenue

Accounting for Income Taxes

Accounting for Pensions and Postretirement Benefits

Accounting for Leases

Accounting Changes and Error Analysis

Statement of Cash Flows

Presentation and Disclosure in Financial Reporting

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