Question 1

The Canadian Business Corporations Act mandates that all incorporated companies in Canada follow IFRS.

Accepted Answer

A) True 
 B)False

Question 2

The primary responsibility of an independent auditor who is a professional accountant is to:

Accepted Answer

A) Prepare or make changes to source documents. 
B) Assess whether the management is honest. 
C) Evaluate the "fair presentation" of the company's financial reports. 
D) Prepare current financial reports for the client. 
A) Prepare or make changes to source documents. 
B) Assess whether the management is honest. 
C) Evaluate the "fair presentation" of the company's financial reports. 
D) Prepare current financial reports for the client.

Question 3

Compared to financial accounting,what are the major concerns of managerial accounting?

Accepted Answer

Management accounting is concerned with

Question 4

Which of the following statements regarding cash flows is not accurate?

Accepted Answer

A) Before the present cash flow statement standard became effective, companies had a choice of whether to report cash flow from operating activities or working capital from operating activities. 
B) Studies have shown that a cash flows report is more relevant to investor decisions than a working capital report. 
C) The reported cash flow from operating activities has been found useful in evaluating a firm's ability to make interest payments and repay debt. 
D) Information about past cash flows is useful in predicting an entity's future cash flows. 
E) Information about the balances of current liabilities, long-term debt and stockholders' equity can be found in the statement of cash flows. 
A) Before the present cash flow statement standard became effective, companies had a choice of whether to report cash flow from operating activities or working capital from operating activities. 
B) Studies have shown that a cash flows report is more relevant to investor decisions than a working capital report. 
C) The reported cash flow from operating activities has been found useful in evaluating a firm's ability to make interest payments and repay debt. 
D) Information about past cash flows is useful in predicting an entity's future cash flows. 
E) Information about the balances of current liabilities, long-term debt and stockholders' equity can be found in the statement of cash flows.

Question 5

Professional accountants need a wide range of knowledge and skills.Which of the following is not an example of such knowledge or skills?

Accepted Answer

A) An ability to calculate and analyze data, and a facility with numbers. 
B) Knowledge of many disciplines such as finance, economics, management, marketing and statistics. 
C) An ability to communicate in a concise and understandable manner. 
D) Skills derived from prior management experience. 
A) An ability to calculate and analyze data, and a facility with numbers. 
B) Knowledge of many disciplines such as finance, economics, management, marketing and statistics. 
C) An ability to communicate in a concise and understandable manner. 
D) Skills derived from prior management experience.

Question 6

A wholly-owned subsidiary of a multinational corporation is essentially a private corporation.

Accepted Answer

A) True 
 B)False

Question 7

Do you think that most companies in the oil sector would adopt expanded disclosure policies or simply adhere to minimum compliance requirements? Explain.

Accepted Answer

Students' answers are sure to vary here,

Question 8

Give examples of provisions,known as maintenance tests or covenants which are often contained in debt contracts or agreements.

Accepted Answer

a) maximum debt: equity ratio

Question 9

A company whose net income is highly correlated to its operating cash flows is said to have a high quality of earnings.

Accepted Answer

A) True 
 B)False

Question 10

The disclosed basis of accounting (DBA) refers to the use of Non-GAAP accounting policies by private companies.

Accepted Answer

A) True 
 B)False

Question 11

Mutual fund companies,which may be privately held,are deemed to have a fiduciary responsibility and must therefore comply with IFRS.

Accepted Answer

A) True 
 B)False

Question 12

Privately held,publicly accountable companies with a fiduciary responsibility must comply with IFRS.

Accepted Answer

A) True 
 B)False

Question 13

The Federal Accounting Standards Board (FASB) is a branch of the CICA.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements is correct?

Accepted Answer

A) There is no hierarchy with respect to primary sources of GAAP. 
B) There is no hierarchy with respect to secondary sources of GAAP. 
C) Both primary and secondary sources of GAAP have established hierarchies. 
D) Neither primary nor secondary sources of GAAP have established hierarchies. 
A) There is no hierarchy with respect to primary sources of GAAP. 
B) There is no hierarchy with respect to secondary sources of GAAP. 
C) Both primary and secondary sources of GAAP have established hierarchies. 
D) Neither primary nor secondary sources of GAAP have established hierarchies.

Question 15

The accounting standards for private enterprises (ASPE) are essentially a scaled-down version of the CICA handbook,which is available to all small and medium sized enterprises with no fiduciary responsibility.

Accepted Answer

A) True 
 B)False

Question 16

A company's functional currency is always the currency in which the financial statements are presented.

Accepted Answer

A) True 
 B)False

Question 17

The disclosed basis of accounting refers to

Accepted Answer

A) the use of non-GAAP policies by private companies. 
B) the use of non-GAAP policies by any company. 
C) the use of International Financial Reporting Standards. 
D) the practice of disclosing all pertinent accounting policies in a company's annual report. 
A) the use of non-GAAP policies by private companies. 
B) the use of non-GAAP policies by any company. 
C) the use of International Financial Reporting Standards. 
D) the practice of disclosing all pertinent accounting policies in a company's annual report.

Question 18

Private placements refer to:

Accepted Answer

A) funds not disclosed by private companies. 
B) debt or equity securities issued to individuals or organizations without being listed with a securities commission. 
C) shares that form part of a control block. 
D) indirect negotiation with the one or more creditors. 
A) funds not disclosed by private companies. 
B) debt or equity securities issued to individuals or organizations without being listed with a securities commission. 
C) shares that form part of a control block. 
D) indirect negotiation with the one or more creditors.

Question 19

Private companies in Canada may choose between IFRS or ASPE.

Accepted Answer

A) True 
 B)False

The Canadian Business Corporations Act mandates that all incorporated companies in Canada follow IFRS.

The primary responsibility of an independent auditor who is a professional accountant is to:

Compared to financial accounting,what are the major concerns of managerial accounting?

Which of the following statements regarding cash flows is not accurate?

Professional accountants need a wide range of knowledge and skills.Which of the following is not an example of such knowledge or skills?

A wholly-owned subsidiary of a multinational corporation is essentially a private corporation.

Do you think that most companies in the oil sector would adopt expanded disclosure policies or simply adhere to minimum compliance requirements? Explain.

Give examples of provisions,known as maintenance tests or covenants which are often contained in debt contracts or agreements.

A company whose net income is highly correlated to its operating cash flows is said to have a high quality of earnings.

The disclosed basis of accounting (DBA) refers to the use of Non-GAAP accounting policies by private companies.

Mutual fund companies,which may be privately held,are deemed to have a fiduciary responsibility and must therefore comply with IFRS.

Privately held,publicly accountable companies with a fiduciary responsibility must comply with IFRS.

The Federal Accounting Standards Board (FASB) is a branch of the CICA.

Which of the following statements is correct?

The accounting standards for private enterprises (ASPE) are essentially a scaled-down version of the CICA handbook,which is available to all small and medium sized enterprises with no fiduciary responsibility.

A company's functional currency is always the currency in which the financial statements are presented.

The disclosed basis of accounting refers to

Private placements refer to:

Private companies in Canada may choose between IFRS or ASPE.

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

The Canadian Business Corporations Act mandates that all incorporated companies in Canada follow IFRS.

The primary responsibility of an independent auditor who is a professional accountant is to:

Compared to financial accounting,what are the major concerns of managerial accounting?

Which of the following statements regarding cash flows is not accurate?

Professional accountants need a wide range of knowledge and skills.Which of the following is not an example of such knowledge or skills?

A wholly-owned subsidiary of a multinational corporation is essentially a private corporation.

Do you think that most companies in the oil sector would adopt expanded disclosure policies or simply adhere to minimum compliance requirements? Explain.

Give examples of provisions,known as maintenance tests or covenants which are often contained in debt contracts or agreements.

A company whose net income is highly correlated to its operating cash flows is said to have a high quality of earnings.

The disclosed basis of accounting (DBA) refers to the use of Non-GAAP accounting policies by private companies.

Mutual fund companies,which may be privately held,are deemed to have a fiduciary responsibility and must therefore comply with IFRS.

Privately held,publicly accountable companies with a fiduciary responsibility must comply with IFRS.

The Federal Accounting Standards Board (FASB) is a branch of the CICA.

Which of the following statements is correct?

The accounting standards for private enterprises (ASPE) are essentially a scaled-down version of the CICA handbook,which is available to all small and medium sized enterprises with no fiduciary responsibility.

A company's functional currency is always the currency in which the financial statements are presented.

The disclosed basis of accounting refers to

Private placements refer to:

Private companies in Canada may choose between IFRS or ASPE.

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