Question 1

Under IAS 18,which of the following is an example of retention of significant risks and rewards by the seller?

Accepted Answer

A) The buyer has no right to rescind the purchase. 
B) The seller is under no obligation for satisfactory performance not covered by normal warranties. 
C) Goods are sold subject to installation,but installation is not a significant part of the contract and has not yet been completed. 
D) Receipt of revenue by the seller is contingent on the buyer generating revenue through its sale of the goods. 
A) The buyer has no right to rescind the purchase. 
B) The seller is under no obligation for satisfactory performance not covered by normal warranties. 
C) Goods are sold subject to installation,but installation is not a significant part of the contract and has not yet been completed. 
D) Receipt of revenue by the seller is contingent on the buyer generating revenue through its sale of the goods. D

Question 2

Which of the following is NOT a share-based payment transaction under IFRS 2?

Accepted Answer

A) equity-settled share-based payment 
B) cash-settled share-based payment 
C) choice-of-settlement share-based payment 
D) All of the above are share-based payment transactions under IFRS 2. 
A) equity-settled share-based payment 
B) cash-settled share-based payment 
C) choice-of-settlement share-based payment 
D) All of the above are share-based payment transactions under IFRS 2. D

Question 3

The following facts apply to questions :
XYZ Company,a calendar-year entity,amends its defined benefit pension plan on January 1,2010 and must recognize the increase in past service costs of its vested and non-vested employees as of that date in the calculation of its net 2010 pension expense (or revenue). The pertinent facts as of January 1,2010 are:
-Calculate the past service costs included in 2010 net pension expense (or revenue)under U.S GAAP.

Accepted Answer

A) $5,100 
B) $5,400 
C) $600 
D) $7,000 
A) $5,100 
B) $5,400 
C) $600 
D) $7,000 C

Question 4

Under IAS 39,Financial Instruments: Recognition and Measurement,which of the following is NOT a category into which a financial asset must be classified?

Accepted Answer

A) property,plant,and equipment 
B) held-to-maturity investments 
C) loans and receivables 
D) available-for-sale financial assets 
A) property,plant,and equipment 
B) held-to-maturity investments 
C) loans and receivables 
D) available-for-sale financial assets

Question 5

Under IAS 12,current and deferred taxes are measured on the basis of:

Accepted Answer

A) rates that have been enacted or substantively enacted by the balance sheet date. 
B) current rates and rates anticipated when temporary differences reverse. 
C) rates anticipated when temporary differences reverse. 
D) whether the entity provides goods or services. 
A) rates that have been enacted or substantively enacted by the balance sheet date. 
B) current rates and rates anticipated when temporary differences reverse. 
C) rates anticipated when temporary differences reverse. 
D) whether the entity provides goods or services.

Question 6

How does U.S.GAAP differ from IFRS with respect to cash-settled share-based payments?

Accepted Answer

A) U)S.GAAP always treats such payments as a liability. 
B) U)S.GAAP offers the option to treat such payments as either a liability or equity. 
C) IFRS and U.S.GAAP follow the same approach with respect to such payments. 
D) U)S.GAAP,under certain circumstances,may treat such payments as equity. 
A) U)S.GAAP always treats such payments as a liability. 
B) U)S.GAAP offers the option to treat such payments as either a liability or equity. 
C) IFRS and U.S.GAAP follow the same approach with respect to such payments. 
D) U)S.GAAP,under certain circumstances,may treat such payments as equity.

Question 7

Under IFRS 2,with respect to choice-of-settlement share-based payments,if it is the entity that has the right to choose between equity settlement and cash settlement,when must the entity choose the cash settlement?

Accepted Answer

A) if the supplier provides services 
B) if the supplier provides goods 
C) if the entity has a present obligation to settle in cash 
D) The entity always has the option to choose either method. 
A) if the supplier provides services 
B) if the supplier provides goods 
C) if the entity has a present obligation to settle in cash 
D) The entity always has the option to choose either method.

Question 8

IAS 18,Revenue,covers which types of revenues?

Accepted Answer

A) sale of goods 
B) rendering of services 
C) interest,royalties,and dividends 
D) all of the above 
A) sale of goods 
B) rendering of services 
C) interest,royalties,and dividends 
D) all of the above

Question 9

Under IFRS 2,with respect to cash-settled share-based payments,when an employee has received stock appreciation rights,how is the fair value of those rights measured?

Accepted Answer

A) using the Black Motor Pool method 
B) using an option pricing model 
C) using the Van der Graaf approach 
D) all of the above 
A) using the Black Motor Pool method 
B) using an option pricing model 
C) using the Van der Graaf approach 
D) all of the above

Question 10

Under IAS 37,inflows of resources that are "virtually certain" to be received should be:

Accepted Answer

A) disclosed as contingent assets in the notes to the financial statements. 
B) recognized as assets. 
C) undisclosed until management is absolutely certain that resources will be received. 
D) reported only in the cash flow statement. 
A) disclosed as contingent assets in the notes to the financial statements. 
B) recognized as assets. 
C) undisclosed until management is absolutely certain that resources will be received. 
D) reported only in the cash flow statement.

Question 11

Under U.S.GAAP,with respect to equity-settled share-based payments,if the fair value of the equity instrument is used,the value is determined:

Accepted Answer

A) at the earlier of the date a commitment for performance is reached or the date the services are actually completed. 
B) at the date the services are actually completed. 
C) at the date a commitment for performance is reached. 
D) none of the above 
A) at the earlier of the date a commitment for performance is reached or the date the services are actually completed. 
B) at the date the services are actually completed. 
C) at the date a commitment for performance is reached. 
D) none of the above

Question 12

According to IAS 37,with respect to onerous contracts,a provision should be recognized for "unavoidable costs of the contract",which is defined as:

Accepted Answer

A) the intrinsic value of the contract. 
B) the lower of cost or market value of the contract. 
C) the lower of cost of fulfillment or the penalty from non-fulfillment of the contract. 
D) none of the above. 
A) the intrinsic value of the contract. 
B) the lower of cost or market value of the contract. 
C) the lower of cost of fulfillment or the penalty from non-fulfillment of the contract. 
D) none of the above.

Question 13

What kinds of temporary differences related to income taxes can arise under IFRS that don't occur under U.S.GAAP?

Accepted Answer

A) book and tax differences related to the revaluation of property,plant,and equipment for book purposes and cost method for tax purposes. 
B) book and tax differences related to the calculation of impairments for book purposes with no like adjustment for tax purposes. 
C) both (
A) and (
B)  
D) use of the LIFO inventory method for book purposes and the FIFO inventory method for tax purposes. 
A) book and tax differences related to the revaluation of property,plant,and equipment for book purposes and cost method for tax purposes. 
B) book and tax differences related to the calculation of impairments for book purposes with no like adjustment for tax purposes. 
C) both (
A) and (
B)  
D) use of the LIFO inventory method for book purposes and the FIFO inventory method for tax purposes.

Question 14

Under IAS 18,if four out of the five conditions for recognizing revenue from the sale of goods are met,and the entity is 75% certain that revenue will be recognized as a result,how would a $100,000 sale be recognized at the time of the sale?

Accepted Answer

A) The recognition of the entire sale must be deferred until the fifth condition has been met. 
B) $75,000 of the sales price can be currently recognized and $25,000 will be treated as a liability. 
C) The entire $100,000 sales price can be currently recognized since most of the conditions have been met. 
D) None of the above represents a proper treatment of this sale. 
A) The recognition of the entire sale must be deferred until the fifth condition has been met. 
B) $75,000 of the sales price can be currently recognized and $25,000 will be treated as a liability. 
C) The entire $100,000 sales price can be currently recognized since most of the conditions have been met. 
D) None of the above represents a proper treatment of this sale.

Question 15

The following facts apply to questions :
XYZ Company,a calendar-year entity,amends its defined benefit pension plan on January 1,2010 and must recognize the increase in past service costs of its vested and non-vested employees as of that date in the calculation of its net 2010 pension expense (or revenue). The pertinent facts as of January 1,2010 are:
-Calculate the past service costs included in 2010 net pension expense (or revenue)under IAS 19.

Accepted Answer

A) $5,100 
B) $5,400 
C) $600 
D) $7,000 
A) $5,100 
B) $5,400 
C) $600 
D) $7,000

Question 16

Under IAS 1,Presentation of Financial Statements,how must deferred taxes be classified on the balance sheet?

Accepted Answer

A) as either a current asset or a current liability 
B) as always a noncurrent asset or a noncurrent liability 
C) as either a current or noncurrent asset or liability based on the expected timing of realization 
D) as a separately stated positive or negative component of equity 
A) as either a current asset or a current liability 
B) as always a noncurrent asset or a noncurrent liability 
C) as either a current or noncurrent asset or liability based on the expected timing of realization 
D) as a separately stated positive or negative component of equity

Question 17

Under a joint exposure draft issued by the IASB and FASB in June 2010,Revenue from Contracts with Customers,which of the following is NOT one of the steps to be applied in the recognition of revenue across a wide range of transactions and industries?

Accepted Answer

A) Identify the contract with a customer. 
B) Do not separate the transaction price for separate performance obligations if the contract is a bundled contract where goods and services are not sold separately. 
C) Identify the separate performance obligations in the contract. 
D) Determine the transaction price. 
A) Identify the contract with a customer. 
B) Do not separate the transaction price for separate performance obligations if the contract is a bundled contract where goods and services are not sold separately. 
C) Identify the separate performance obligations in the contract. 
D) Determine the transaction price.

Question 18

Under IAS 39,under what circumstances will derecognition of a financial liability occur?

Accepted Answer

A) when the obligation has been paid 
B) when the obligation has been canceled 
C) when the obligation has expired 
D) all of the above 
A) when the obligation has been paid 
B) when the obligation has been canceled 
C) when the obligation has expired 
D) all of the above

Question 19

IAS 32 defines a financial instrument as:

Accepted Answer

A) the currency of a foreign country in which the enterprise does business. 
B) a certified check. 
C) any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. 
D) a recognized stock exchange. 
A) the currency of a foreign country in which the enterprise does business. 
B) a certified check. 
C) any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. 
D) a recognized stock exchange.

Question 20

What is true about both IFRS and U.S.GAAP with respect to service contracts?

Accepted Answer

A) IFRS and U.S.GAAP both allow the use of the percentage-of-completion method. 
B) Neither IFRS,nor U.S.GAAP allows the use of the percentage-of-completion method. 
C) IFRS allows the use of the percentage-of-completion method while U.S.GAAP does not. 
D) U)S.GAAP allows the use of the percentage-of-completion method while IFRS does not. 
A) IFRS and U.S.GAAP both allow the use of the percentage-of-completion method. 
B) Neither IFRS,nor U.S.GAAP allows the use of the percentage-of-completion method. 
C) IFRS allows the use of the percentage-of-completion method while U.S.GAAP does not. 
D) U)S.GAAP allows the use of the percentage-of-completion method while IFRS does not.

Under IAS 18,which of the following is an example of retention of significant risks and rewards by the seller?

Which of the following is NOT a share-based payment transaction under IFRS 2?

Under IAS 39,Financial Instruments: Recognition and Measurement,which of the following is NOT a category into which a financial asset must be classified?

Under IAS 12,current and deferred taxes are measured on the basis of:

How does U.S.GAAP differ from IFRS with respect to cash-settled share-based payments?

Under IFRS 2,with respect to choice-of-settlement share-based payments,if it is the entity that has the right to choose between equity settlement and cash settlement,when must the entity choose the cash settlement?

IAS 18,Revenue,covers which types of revenues?

Under IFRS 2,with respect to cash-settled share-based payments,when an employee has received stock appreciation rights,how is the fair value of those rights measured?

Under IAS 37,inflows of resources that are "virtually certain" to be received should be:

Under U.S.GAAP,with respect to equity-settled share-based payments,if the fair value of the equity instrument is used,the value is determined:

According to IAS 37,with respect to onerous contracts,a provision should be recognized for "unavoidable costs of the contract",which is defined as:

What kinds of temporary differences related to income taxes can arise under IFRS that don't occur under U.S.GAAP?

Under IAS 18,if four out of the five conditions for recognizing revenue from the sale of goods are met,and the entity is 75% certain that revenue will be recognized as a result,how would a $100,000 sale be recognized at the time of the sale?

Under IAS 1,Presentation of Financial Statements,how must deferred taxes be classified on the balance sheet?

Under a joint exposure draft issued by the IASB and FASB in June 2010,Revenue from Contracts with Customers,which of the following is NOT one of the steps to be applied in the recognition of revenue across a wide range of transactions and industries?

Under IAS 39,under what circumstances will derecognition of a financial liability occur?

IAS 32 defines a financial instrument as:

What is true about both IFRS and U.S.GAAP with respect to service contracts?

Introduction to International Accounting

Worldwide Accounting Diversity

International Convergence of Financial Reporting

International Financial Reporting Standards: Part I

Comparative Accounting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Additional Financial Reporting Issues

Analysis of Foreign Financial Statements

International Taxation

International Transfer Pricing

Strategic Accounting Issues in Multinational Corporations

Comparative International Auditing and Corporate Governance

International Corporate Social Reporting

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Exam 5: International Financial Reporting Standards: Part II

Under IAS 18,which of the following is an example of retention of significant risks and rewards by the seller?

Which of the following is NOT a share-based payment transaction under IFRS 2?

Under IAS 39,Financial Instruments: Recognition and Measurement,which of the following is NOT a category into which a financial asset must be classified?

Under IAS 12,current and deferred taxes are measured on the basis of:

How does U.S.GAAP differ from IFRS with respect to cash-settled share-based payments?

Under IFRS 2,with respect to choice-of-settlement share-based payments,if it is the entity that has the right to choose between equity settlement and cash settlement,when must the entity choose the cash settlement?

IAS 18,Revenue,covers which types of revenues?

Under IFRS 2,with respect to cash-settled share-based payments,when an employee has received stock appreciation rights,how is the fair value of those rights measured?

Under IAS 37,inflows of resources that are "virtually certain" to be received should be:

Under U.S.GAAP,with respect to equity-settled share-based payments,if the fair value of the equity instrument is used,the value is determined:

According to IAS 37,with respect to onerous contracts,a provision should be recognized for "unavoidable costs of the contract",which is defined as:

What kinds of temporary differences related to income taxes can arise under IFRS that don't occur under U.S.GAAP?

Under IAS 18,if four out of the five conditions for recognizing revenue from the sale of goods are met,and the entity is 75% certain that revenue will be recognized as a result,how would a $100,000 sale be recognized at the time of the sale?

Under IAS 1,Presentation of Financial Statements,how must deferred taxes be classified on the balance sheet?

Under a joint exposure draft issued by the IASB and FASB in June 2010,Revenue from Contracts with Customers,which of the following is NOT one of the steps to be applied in the recognition of revenue across a wide range of transactions and industries?

Under IAS 39,under what circumstances will derecognition of a financial liability occur?

IAS 32 defines a financial instrument as:

What is true about both IFRS and U.S.GAAP with respect to service contracts?

Introduction to International Accounting

Worldwide Accounting Diversity

International Convergence of Financial Reporting

International Financial Reporting Standards: Part I

Comparative Accounting

Foreign Currency Transactions and Hedging Foreign Exchange Risk

Translation of Foreign Currency Financial Statements

Additional Financial Reporting Issues

Analysis of Foreign Financial Statements

International Taxation

International Transfer Pricing

Strategic Accounting Issues in Multinational Corporations

Comparative International Auditing and Corporate Governance

International Corporate Social Reporting

Filters