Question 1

Wahi Limited reported the following items on their Statement of Financial Position:   The debt to equity ratio for Wahi is closest to

Accepted Answer

A)  2.0. 
B)  1.7. 
C)  1.22. 
D)  0.88. 
A)  2.0. 
B)  1.7. 
C)  1.22. 
D)  0.88. B

Question 2

Use the following information to answer question
Canin Cranes Co. leased an asset under the following terms:  
-The lease should be classified by Canin Cranes Co. as a(n)

Accepted Answer

A)  operating lease. 
B)  commercial lease. 
C)  leveraged lease. 
D)  finance lease. 
A)  operating lease. 
B)  commercial lease. 
C)  leveraged lease. 
D)  finance lease. A

Question 3

The carrying value of a bond issued at a discount decreases over time.

Accepted Answer

A) True 
 B)False  True

Question 4

The journal entry to record income taxes owing is

Accepted Answer

A)  Dr. Income Taxes Receivable, Cr. Income Tax Revenue. 
B)  Dr. Income Tax Expense, Cr. CRA Payable. 
C)  Dr. Income Tax Expense, Cr. Deferred Tax Liability. 
D)  Dr. Income Tax Payable, Cr. Cash. 
A)  Dr. Income Taxes Receivable, Cr. Income Tax Revenue. 
B)  Dr. Income Tax Expense, Cr. CRA Payable. 
C)  Dr. Income Tax Expense, Cr. Deferred Tax Liability. 
D)  Dr. Income Tax Payable, Cr. Cash.

Question 5

Temporary differences between accounting and taxable income will eventually offset.

Accepted Answer

A) True 
 B)False

Question 6

All of the following are used to determine the bond premium or the bond discount EXCEPT for

Accepted Answer

A)  market rate. 
B)  yield rate. 
C)  coupon rate. 
D)  capital rate. 
A)  market rate. 
B)  yield rate. 
C)  coupon rate. 
D)  capital rate.

Question 7

DRM Corporation leased a piece of machinery and correctly classified and recorded it as a finance lease. At the date of signing, January 1, 2017, the asset and lease obligation were recorded for $42,000. The first lease payment of $8,200 was due December 31, 2017 and the interest rate they used in their calculations was 7%. The lease term was 10 years. Which of the following best describes what would be reported on AFC's Statement of Income for the year ending December 31, 2017?

Accepted Answer

A)  $8,200 Lease Expense 
B)  $8,200 Lease Expense, $4,200 Depreciation Expense 
C)  $2,940 Interest Expense, $1,260 Depreciation Expense 
D)  $2,940 Interest Expense, $4,200 Depreciation Expense 
A)  $8,200 Lease Expense 
B)  $8,200 Lease Expense, $4,200 Depreciation Expense 
C)  $2,940 Interest Expense, $1,260 Depreciation Expense 
D)  $2,940 Interest Expense, $4,200 Depreciation Expense

Question 8

A finance lease allows a firm to report more expenses over the life of a lease than an operating lease.

Accepted Answer

A) True 
 B)False

Question 9

All of the following transactions lead to temporary timing differences EXCEPT

Accepted Answer

A)  the use of straight-line depreciation of accounting purposes. 
B)  the use of estimated warranty costs for calculating warranty expense. 
C)  the recognition of dividend income for dividends received from another Canadian company. 
D)  all of the above lead to temporary timing differences. 
A)  the use of straight-line depreciation of accounting purposes. 
B)  the use of estimated warranty costs for calculating warranty expense. 
C)  the recognition of dividend income for dividends received from another Canadian company. 
D)  all of the above lead to temporary timing differences.

Question 10

Non-financial covenants may include a requirement to have an annual audit.

Accepted Answer

A) True 
 B)False

Question 11

A public offering is open to all investors including institutions.

Accepted Answer

A) True 
 B)False

Question 12

Restrictions placed on a company in their bond indenture agreement are known as

Accepted Answer

A)  collateral. 
B)  bond indenture. 
C)  bond covenants. 
D)  agreements. 
A)  collateral. 
B)  bond indenture. 
C)  bond covenants. 
D)  agreements.

Question 13

If the lessee makes the following entry   what type of lease do they have?

Accepted Answer

A)  commercial lease 
B)  finance lease 
C)  operating lease 
D)  sales-type lease 
A)  commercial lease 
B)  finance lease 
C)  operating lease 
D)  sales-type lease

Question 14

A temporary difference is a difference between tax and accounting income that will not reverse in a future period.

Accepted Answer

A) True 
 B)False

Question 15

Bank loan covenants only pertain to financial data such as ratios.

Accepted Answer

A) True 
 B)False

Question 16

Pension funds are described as underfunded if the value of the pensions fund assets is less than the present value of the future pension obligations.

Accepted Answer

A) True 
 B)False

Question 17

A defined benefit plan is similar to a defined contribution plan in that only employers contribute to the plan.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following contingent losses would require footnote disclosure only?

Accepted Answer

A)  a likely loss with an amount that can be reasonably estimated 
B)  a likely loss of a known amount 
C)  an unlikely loss 
D)  a likely loss with an amount that cannot be reasonably estimated 
A)  a likely loss with an amount that can be reasonably estimated 
B)  a likely loss of a known amount 
C)  an unlikely loss 
D)  a likely loss with an amount that cannot be reasonably estimated

Question 19

A bond issue is a form of

Accepted Answer

A)  equity financing. 
B)  debt financing. 
C)  collateral financing. 
D)  financing similar to an instalment loan. 
A)  equity financing. 
B)  debt financing. 
C)  collateral financing. 
D)  financing similar to an instalment loan.

Question 20

From the lessee's point of view, which type of lease means that its debt to equity ratio will not be affected?

Accepted Answer

A)  operating lease 
B)  sales-type lease 
C)  leveraged lease 
D)  finance lease 
A)  operating lease 
B)  sales-type lease 
C)  leveraged lease 
D)  finance lease

Wahi Limited reported the following items on their Statement of Financial Position: The debt to equity ratio for Wahi is closest to

Use the following information to answer question Canin Cranes Co. leased an asset under the following terms: -The lease should be classified by Canin Cranes Co. as a(n)

The carrying value of a bond issued at a discount decreases over time.

The journal entry to record income taxes owing is

Temporary differences between accounting and taxable income will eventually offset.

All of the following are used to determine the bond premium or the bond discount EXCEPT for

A finance lease allows a firm to report more expenses over the life of a lease than an operating lease.

All of the following transactions lead to temporary timing differences EXCEPT

Non-financial covenants may include a requirement to have an annual audit.

A public offering is open to all investors including institutions.

Restrictions placed on a company in their bond indenture agreement are known as

If the lessee makes the following entry what type of lease do they have?

A temporary difference is a difference between tax and accounting income that will not reverse in a future period.

Bank loan covenants only pertain to financial data such as ratios.

Pension funds are described as underfunded if the value of the pensions fund assets is less than the present value of the future pension obligations.

A defined benefit plan is similar to a defined contribution plan in that only employers contribute to the plan.

Which of the following contingent losses would require footnote disclosure only?

A bond issue is a form of

From the lessee's point of view, which type of lease means that its debt to equity ratio will not be affected?

Overview of Corporate Financial Reporting

Nalyzing Transaction and Their Effect on Financial Statement

Double-Entry Accounting and the Accounting Cycle

Revenue Recognition and the Statement of Incom

Revenue Recognition and the Statement of Income

The Statement of Cash Flows

Cash and Accounts

Inventory

Long-Term Assets

Shareholders Equity

Financial Statement Analysis

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Exam 10: Long-Term Liabilities

Wahi Limited reported the following items on their Statement of Financial Position: The debt to equity ratio for Wahi is closest to

Use the following information to answer question Canin Cranes Co. leased an asset under the following terms: -The lease should be classified by Canin Cranes Co. as a(n)

The carrying value of a bond issued at a discount decreases over time.

The journal entry to record income taxes owing is

Temporary differences between accounting and taxable income will eventually offset.

All of the following are used to determine the bond premium or the bond discount EXCEPT for

A finance lease allows a firm to report more expenses over the life of a lease than an operating lease.

All of the following transactions lead to temporary timing differences EXCEPT

Non-financial covenants may include a requirement to have an annual audit.

A public offering is open to all investors including institutions.

Restrictions placed on a company in their bond indenture agreement are known as

If the lessee makes the following entry what type of lease do they have?

A temporary difference is a difference between tax and accounting income that will not reverse in a future period.

Bank loan covenants only pertain to financial data such as ratios.

Pension funds are described as underfunded if the value of the pensions fund assets is less than the present value of the future pension obligations.

A defined benefit plan is similar to a defined contribution plan in that only employers contribute to the plan.

Which of the following contingent losses would require footnote disclosure only?

A bond issue is a form of

From the lessee's point of view, which type of lease means that its debt to equity ratio will not be affected?

Overview of Corporate Financial Reporting

Nalyzing Transaction and Their Effect on Financial Statement

Double-Entry Accounting and the Accounting Cycle

Revenue Recognition and the Statement of Incom

Revenue Recognition and the Statement of Income

The Statement of Cash Flows

Cash and Accounts

Inventory

Long-Term Assets

Shareholders Equity

Financial Statement Analysis

Filters