Question 1

Which of these following is NOT true regarding generally accepted accounting principles?

Accepted Answer

A) Include specific rules, practices and procedures. 
B) Include broad principles and conventions of general applications including underlying concepts 
C) Standards of accounting, a material departure from which may result in a qualified opinion issued by an auditor. 
D) The GAAP requirement for Private companies is enforceable by the provincial securities commissions. 
A) Include specific rules, practices and procedures. 
B) Include broad principles and conventions of general applications including underlying concepts 
C) Standards of accounting, a material departure from which may result in a qualified opinion issued by an auditor. 
D) The GAAP requirement for Private companies is enforceable by the provincial securities commissions.

Question 2

The influence of tax rules when selecting appropriate accounting treatment for a transaction is particularly strong with public companies.

Accepted Answer

A) True 
 B)False

Question 3

In North America,the principal stakeholder to whom general-purpose financial statements are geared is the shareholder.

Accepted Answer

A) True 
 B)False

Question 4

The various provincial securities commissions do not exert influence on the development of accounting standards.

Accepted Answer

A) True 
 B)False

Question 5

Canada has adapted its own pre-existing standards for public companies to IFRS,while the U.S has adopted IFRS completely.

Accepted Answer

A) True 
 B)False

Question 6

Briefly explain how the CRA (Revenue Canada) differs from most GAAP based policies in terms of revenue recognition

Accepted Answer

Most GAAP-based policies recognize reven

Question 7

IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).

Accepted Answer

A) True 
 B)False

Question 8

The users toward which financial statements are directed:

Accepted Answer

A) are very sophisticated and experienced in using financial information. 
B) are independent Public Accountants. 
C) have degrees in accounting and finance. 
D) have a reasonable understanding of business and economic activities. 
E) are Chartered Financial Analysts. 
A) are very sophisticated and experienced in using financial information. 
B) are independent Public Accountants. 
C) have degrees in accounting and finance. 
D) have a reasonable understanding of business and economic activities. 
E) are Chartered Financial Analysts.

Question 9

During the coming years,we should expect the ACSB to

Accepted Answer

A) extend differential reporting options available to private companies. 
B) harmonize Canadian GAAP to international standards. 
C) continue to provide accounting standards for private companies. 
D) All of these choices are correct. 
A) extend differential reporting options available to private companies. 
B) harmonize Canadian GAAP to international standards. 
C) continue to provide accounting standards for private companies. 
D) All of these choices are correct.

Question 10

What is GAAP,how is it currently defined,and what is the outcome of the due process?

Accepted Answer

GAAP is the set of rules,procedures,poli

Question 11

The organization created to develop accounting standards in Canada,the AcSB,is NOT concerned about:

Accepted Answer

A) reported cash flows. 
B) reported earnings. 
C) reported comparability of results. 
D) reporting financial position. 
E) all of these answers are correct. 
A) reported cash flows. 
B) reported earnings. 
C) reported comparability of results. 
D) reporting financial position. 
E) all of these answers are correct.

Question 12

Disclosure notes facilitate the evaluation of enterprise position and performance because they include information,which helps to explain qualitative aspects of earnings.

Accepted Answer

A) True 
 B)False

Question 13

The International Accounting Standards Committee (IASC),established in 1973 has the objective to promote the worldwide harmonization of accounting principles.Is this harmonization necessary to allow movement of capital between countries?

Accepted Answer

Although there is pressure from securiti

Question 14

The body that has the responsibility to set generally accepted accounting principles in Canada is the

Accepted Answer

A) FASB 
B) IASC 
C) AcSB 
D) OSC 
A) FASB 
B) IASC 
C) AcSB 
D) OSC

Question 15

Give two reasons why managers may have a bias toward smoothing earnings,and give two examples stating how this is achieved in practice.

Accepted Answer

Income smoothing is performed:
a.To redu

Question 16

What is the purpose of financial statements?

Accepted Answer

A) To disclose the market value of the firm's assets and liabilities. 
B) To determine compliance with tax laws. 
C) To identify shareholders. 
D) To help users make decisions. 
A) To disclose the market value of the firm's assets and liabilities. 
B) To determine compliance with tax laws. 
C) To identify shareholders. 
D) To help users make decisions.

Question 17

Due to the excellent work of the ACSB,there are very few choices among alternative accounting policies today.

Accepted Answer

A) True 
 B)False

Question 18

Choose the correct statement about audits of corporations:

Accepted Answer

A) Outside auditors are paid by the government for auditing the financial statements of corporations. 
B) Revenue Canada performs audits of corporations' financial statements. 
C) Public corporations (those whose stock are traded on exchanges) are subject to annual audit as to their compliance with GAAP. 
D) It is the employees of the firm being audited who perform the annual audit of the financial statements of that firm. 
A) Outside auditors are paid by the government for auditing the financial statements of corporations. 
B) Revenue Canada performs audits of corporations' financial statements. 
C) Public corporations (those whose stock are traded on exchanges) are subject to annual audit as to their compliance with GAAP. 
D) It is the employees of the firm being audited who perform the annual audit of the financial statements of that firm.

Question 19

The stewardship function refers to:

Accepted Answer

A) Disclosing management's use of funds and other financial information to absentee shareholders. 
B) A company's corporate citizenship track record. 
C) The collection of information for planning the future of the entity, implementing those plans, and for controlling daily operations. 
D) The collection of information to help present and potential investors and creditors and other users in assessing the amounts, timing and uncertainty of prospective cash receipts. 
A) Disclosing management's use of funds and other financial information to absentee shareholders. 
B) A company's corporate citizenship track record. 
C) The collection of information for planning the future of the entity, implementing those plans, and for controlling daily operations. 
D) The collection of information to help present and potential investors and creditors and other users in assessing the amounts, timing and uncertainty of prospective cash receipts.

Question 20

Users of financial statements can generally be broken down into which of the following two categories:

Accepted Answer

A) government and external users. 
B) Government and investors. 
C) Creditors and Investors. 
D) External users and preparers. 
A) government and external users. 
B) Government and investors. 
C) Creditors and Investors. 
D) External users and preparers.

Which of these following is NOT true regarding generally accepted accounting principles?

The influence of tax rules when selecting appropriate accounting treatment for a transaction is particularly strong with public companies.

In North America,the principal stakeholder to whom general-purpose financial statements are geared is the shareholder.

The various provincial securities commissions do not exert influence on the development of accounting standards.

Canada has adapted its own pre-existing standards for public companies to IFRS,while the U.S has adopted IFRS completely.

Briefly explain how the CRA (Revenue Canada) differs from most GAAP based policies in terms of revenue recognition

IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).

The users toward which financial statements are directed:

During the coming years,we should expect the ACSB to

What is GAAP,how is it currently defined,and what is the outcome of the due process?

The organization created to develop accounting standards in Canada,the AcSB,is NOT concerned about:

Disclosure notes facilitate the evaluation of enterprise position and performance because they include information,which helps to explain qualitative aspects of earnings.

The International Accounting Standards Committee (IASC),established in 1973 has the objective to promote the worldwide harmonization of accounting principles.Is this harmonization necessary to allow movement of capital between countries?

The body that has the responsibility to set generally accepted accounting principles in Canada is the

Give two reasons why managers may have a bias toward smoothing earnings,and give two examples stating how this is achieved in practice.

What is the purpose of financial statements?

Due to the excellent work of the ACSB,there are very few choices among alternative accounting policies today.

Choose the correct statement about audits of corporations:

The stewardship function refers to:

Users of financial statements can generally be broken down into which of the following two categories:

Accounting Judgements

Statements of Income and Comprehensive Income

Statements of Financial Position and Changes in Equity; Disclosure Notes

The Statement of Cash Flows

Financial Assets: Cash and Receivables

Cost-Based Inventories and Cost of Sales

Property,Plant,and Equipment; Intangibles; and Goodwill

Depreciation,Amortization,and Impairment

Financial Instruments: Investments in Debt and Equity Securities

Filters

Exam 1: The Framework for Financial Reporting

Which of these following is NOT true regarding generally accepted accounting principles?

The influence of tax rules when selecting appropriate accounting treatment for a transaction is particularly strong with public companies.

In North America,the principal stakeholder to whom general-purpose financial statements are geared is the shareholder.

The various provincial securities commissions do not exert influence on the development of accounting standards.

Canada has adapted its own pre-existing standards for public companies to IFRS,while the U.S has adopted IFRS completely.

Briefly explain how the CRA (Revenue Canada) differs from most GAAP based policies in terms of revenue recognition

IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).

The users toward which financial statements are directed:

During the coming years,we should expect the ACSB to

What is GAAP,how is it currently defined,and what is the outcome of the due process?

The organization created to develop accounting standards in Canada,the AcSB,is NOT concerned about:

Disclosure notes facilitate the evaluation of enterprise position and performance because they include information,which helps to explain qualitative aspects of earnings.

The International Accounting Standards Committee (IASC),established in 1973 has the objective to promote the worldwide harmonization of accounting principles.Is this harmonization necessary to allow movement of capital between countries?

The body that has the responsibility to set generally accepted accounting principles in Canada is the

Give two reasons why managers may have a bias toward smoothing earnings,and give two examples stating how this is achieved in practice.

What is the purpose of financial statements?

Due to the excellent work of the ACSB,there are very few choices among alternative accounting policies today.

Choose the correct statement about audits of corporations:

The stewardship function refers to:

Users of financial statements can generally be broken down into which of the following two categories:

Accounting Judgements

Statements of Income and Comprehensive Income

Statements of Financial Position and Changes in Equity; Disclosure Notes

The Statement of Cash Flows

Financial Assets: Cash and Receivables

Cost-Based Inventories and Cost of Sales

Property,Plant,and Equipment; Intangibles; and Goodwill

Depreciation,Amortization,and Impairment

Financial Instruments: Investments in Debt and Equity Securities

Filters