Question 1

The payout ratio is calculated by dividing

Accepted Answer

A) dividends per share by earnings per share. 
B) cash dividends by net income plus preference dividends. 
C) cash dividends by market price per share. 
D) cash dividends by net income less preference dividends. 
A) dividends per share by earnings per share. 
B) cash dividends by net income plus preference dividends. 
C) cash dividends by market price per share. 
D) cash dividends by net income less preference dividends.

Question 2

An operating segment is a reportable segment if

Accepted Answer

A) its operating profit is 10% or more of the combined operating profit of profitable segments. 
B) its operating loss is 10% or more of the combined operating losses of segments that incurred an operating loss. 
C) the absolute amount of its operating profit or loss is 10% or more of the company's combined operating profit or loss. 
D) none of these. 
A) its operating profit is 10% or more of the combined operating profit of profitable segments. 
B) its operating loss is 10% or more of the combined operating losses of segments that incurred an operating loss. 
C) the absolute amount of its operating profit or loss is 10% or more of the company's combined operating profit or loss. 
D) none of these.

Question 3

How is the average inventory used in the calculation of each of the following?

Accepted Answer

The answer of How is the average inventory used in...

Question 4

Use the following information for questions.
The following data are provided:
   
Additional information:
Depreciation included in cost of goods sold and operating expenses is $305,000.On May 1, 2011, 15,000 ordinary shares were issued.The preference share are cumulative.The preference dividends were not declared during 2011.
-The receivables turnover for 2011 is

Accepted Answer

A) 3,200 ÷ 400. 
B) 2,100 ÷ 400. 
C) 3,200 ÷ 350. 
D) 2,100 ÷ 350. 
A) 3,200 ÷ 400. 
B) 2,100 ÷ 400. 
C) 3,200 ÷ 350. 
D) 2,100 ÷ 350.

Question 5

Presented below is information related to Tolbert Company.
Current Assets
 
Total current liabilities are $200,000.What is the acid-test ratio?

Accepted Answer

A) 2.8 to 1. 
B) 2.5 to 1. 
C) 1.4 to 1. 
D) 0.8 to 1. 
A) 2.8 to 1. 
B) 2.5 to 1. 
C) 1.4 to 1. 
D) 0.8 to 1.

Question 6

A segment of a business enterprise is to be reported separately when the revenues of the segment exceed 10 percent of the

Accepted Answer

A) total combined revenues of all segments reporting profits. 
B) total revenues of all the enterprise's industry segments. 
C) total export and foreign sales. 
D) combined net income of all segments reporting profits. 
A) total combined revenues of all segments reporting profits. 
B) total revenues of all the enterprise's industry segments. 
C) total export and foreign sales. 
D) combined net income of all segments reporting profits.

Question 7

An inventory loss from market decline of $1,600,000 occurred in May 2011, after its March 31, 2011 quarterly report was issued.None of this loss was recovered by the end of the year.How should this loss be reflected in the company's quarterly income statements?

Additional information:
There are no preferred dividends in arrears, the balances in the Accounts Receivable and Inventory accounts are unchanged from January 1, 2011, and there were no changes in the Bonds Payable, share capital-Preference or ordinary accounts during 2011.Assume that preferred dividends for the current year have not been declared.

Accepted Answer

The answer of An inventory loss from market decline of...

Question 8

What did the IASB decide was a reasonable upper limit for the number of segment that a company must disclose?

Accepted Answer

A) two 
B) five 
C) six 
D) ten 
A) two 
B) five 
C) six 
D) ten

Question 9

The IASB and the FASB are proposing better ways to present information for businesses in the statement of financial position, including the separation of assets and liabilities into operating and investing categories.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following ratios measures long-term solvency?

Accepted Answer

A) Acid-test ratio 
B) Receivables turnover 
C) Debt to total assets 
D) Current ratio 
A) Acid-test ratio 
B) Receivables turnover 
C) Debt to total assets 
D) Current ratio

Question 11

Fraudulent financial reporting is intentional or reckless conduct, whether act or omission, that results in materially misleading financial statements.

Accepted Answer

A) True 
 B)False

Question 12

The IASB has developed IFRS for small-and medium-sized entities that publish general-purpose financial statement for external users but do not issue shares in a public market.

Accepted Answer

A) True 
 B)False

Question 13

The IASB requires allocations of joint, common, or company-wide costs solely for external reporting purposes.

Accepted Answer

A) True 
 B)False

Question 14

Income tax expense is recognized in each interim period based on the best estimate of the weighted-average annual income tax rate expected for the full financial year.

Accepted Answer

A) True 
 B)False

Question 15

All of the following are exemptions to retrospective application in first-time adoption of IFRS except

Accepted Answer

A) estimates. 
B) hedge accounting. 
C) non-controlling interest. 
D) deferred taxes. 
A) estimates. 
B) hedge accounting. 
C) non-controlling interest. 
D) deferred taxes.

Question 16

Elective exemptions to retrospective application in first-time adoption of IFRS include all of the following except

Accepted Answer

A) share-based payment transactions. 
B) deferred taxes. 
C) leases. 
D) employee benefits. 
A) share-based payment transactions. 
B) deferred taxes. 
C) leases. 
D) employee benefits.

Question 17

Companies should generally use the same accounting policies for interim reports and for annual reports.

Accepted Answer

A) True 
 B)False

Question 18

Mayo Corp.has estimated that total depreciation expense for the year ending December 31, 2011 will amount to $300,000, and that 2011 year-end bonuses to employees will total $600,000.In Mayo's interim income statement for the six months ended June 30, 2011, what is the total amount of expense relating to these two items that should be reported?

Accepted Answer

A) $0. 
B) $150,000. 
C) $450,000. 
D) $900,000. 
A) $0. 
B) $150,000. 
C) $450,000. 
D) $900,000.

Question 19

All of the following are benefits to the IASB requiring a reconciliation between the effective tax rate and the government's statutory rate except:

Accepted Answer

A) An investor can determine the actual taxes paid by the enterprise. 
B) This reconciliation is important if the enterprise has substantial fluctuations in its effective tax rate caused by unusual or infrequent transactions. 
C) This information is effective in identifying a favorable tax treatment that is not sustainable. 
D) The reconciliation can identify past penalties levied by the IRS on the company. 
A) An investor can determine the actual taxes paid by the enterprise. 
B) This reconciliation is important if the enterprise has substantial fluctuations in its effective tax rate caused by unusual or infrequent transactions. 
C) This information is effective in identifying a favorable tax treatment that is not sustainable. 
D) The reconciliation can identify past penalties levied by the IRS on the company.

Question 20

A qualified opinion is issued when the exception to the standard opinion is not of sufficient magnitude to invalidate the statements as a whole.

Accepted Answer

A) True 
 B)False

Exam 24: Presentation and Disclosure in Financial Reporting

The payout ratio is calculated by dividing

An operating segment is a reportable segment if

How is the average inventory used in the calculation of each of the following?

Presented below is information related to Tolbert Company. Current Assets Total current liabilities are $200,000.What is the acid-test ratio?

A segment of a business enterprise is to be reported separately when the revenues of the segment exceed 10 percent of the

What did the IASB decide was a reasonable upper limit for the number of segment that a company must disclose?

The IASB and the FASB are proposing better ways to present information for businesses in the statement of financial position, including the separation of assets and liabilities into operating and investing categories.

Which of the following ratios measures long-term solvency?

Fraudulent financial reporting is intentional or reckless conduct, whether act or omission, that results in materially misleading financial statements.

The IASB has developed IFRS for small-and medium-sized entities that publish general-purpose financial statement for external users but do not issue shares in a public market.

The IASB requires allocations of joint, common, or company-wide costs solely for external reporting purposes.

Income tax expense is recognized in each interim period based on the best estimate of the weighted-average annual income tax rate expected for the full financial year.

All of the following are exemptions to retrospective application in first-time adoption of IFRS except

Elective exemptions to retrospective application in first-time adoption of IFRS include all of the following except

Companies should generally use the same accounting policies for interim reports and for annual reports.

All of the following are benefits to the IASB requiring a reconciliation between the effective tax rate and the government's statutory rate except:

A qualified opinion is issued when the exception to the standard opinion is not of sufficient magnitude to invalidate the statements as a whole.

Financial Accounting and Accounting Standards

Conceptual Framework Underlying Financial Accounting

The Accounting Information System

Income Statement and Related Information

Statement of Financial Position and Statement of Cash Flows

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

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