Question 1

When are financial items recognized in the financial statements?

Accepted Answer

A) Items are recognized if the fair value amounts can be determined. 
B) Items are recognized if the inflows or outflows of resources are probable. 
C) Items are recognized if the future gains will result from disposal of the item. 
D) Items are recognized if there are no measurement uncertainties. 
A) Items are recognized if the fair value amounts can be determined. 
B) Items are recognized if the inflows or outflows of resources are probable. 
C) Items are recognized if the future gains will result from disposal of the item. 
D) Items are recognized if there are no measurement uncertainties. B

Question 2

Which statement best explains the qualitative characteristic of "completeness"?

Accepted Answer

A) Financial statements should represent the underlying transactions,assets and liabilities. 
B) Omission of financial information that would influence a user's economic decision. 
C) Financial information should not contain errors or bias. 
D) Financial statements should not omit material items or transactions. 
A) Financial statements should represent the underlying transactions,assets and liabilities. 
B) Omission of financial information that would influence a user's economic decision. 
C) Financial information should not contain errors or bias. 
D) Financial statements should not omit material items or transactions. D

Question 3

Which statement best explains the meaning of "measurement" in financial reporting?

Accepted Answer

A) Determining where items should be presented in the body of the financial statements. 
B) Presenting an item in the financial statements but not in the notes. 
C) Quantifying items so that they can be presented in the body of the financial statements. 
D) Presenting expenses in the same accounting period as the related revenues. 
A) Determining where items should be presented in the body of the financial statements. 
B) Presenting an item in the financial statements but not in the notes. 
C) Quantifying items so that they can be presented in the body of the financial statements. 
D) Presenting expenses in the same accounting period as the related revenues. C

Question 4

Which statement best explains the meaning of "presentation" in financial reporting?

Accepted Answer

A) Determining where items should be presented in the body of the financial statements. 
B) Presenting an item in the body of the financial statements and in the notes. 
C) Quantifying items so that they can be presented in the body of the financial statements. 
D) Presenting expenses in the same accounting period as the related revenues. 
A) Determining where items should be presented in the body of the financial statements. 
B) Presenting an item in the body of the financial statements and in the notes. 
C) Quantifying items so that they can be presented in the body of the financial statements. 
D) Presenting expenses in the same accounting period as the related revenues.

Question 5

In which of the following transactions would it not be appropriate to recognize an asset in the financial statements?

Accepted Answer

A) SGG receives a firm commitment from another company to purchase goods from SGG. 
B) SGG pays $10,000 to a lawyer for services to be provided next year. 
C) SGG provides services to another company,but will not be paid until after year end. 
D) A customer of SGG makes a deposit of $1,500 for goods to be custom-made. 
A) SGG receives a firm commitment from another company to purchase goods from SGG. 
B) SGG pays $10,000 to a lawyer for services to be provided next year. 
C) SGG provides services to another company,but will not be paid until after year end. 
D) A customer of SGG makes a deposit of $1,500 for goods to be custom-made.

Question 6

Which of the following is not a purpose of a conceptual framework of accounting concepts and financial reporting objectives?

Accepted Answer

A) To increase the user's ability to understand financial statements. 
B) To increase financial statement users' confidence in financial reporting. 
C) To provide a foundation for detailed accounting and reporting rules. 
D) To enhance comparability among companies' financial statements. 
A) To increase the user's ability to understand financial statements. 
B) To increase financial statement users' confidence in financial reporting. 
C) To provide a foundation for detailed accounting and reporting rules. 
D) To enhance comparability among companies' financial statements.

Question 7

Maybel Company has a March 31,2016 year end.Which of the following should not be recorded as a current liability?

Accepted Answer

A) A deposit received from a customer for the February 2017 rent on a 1-year lease entered into on March 1,2016. 
B) Unpaid payroll taxes. 
C) Dividends in arrears on preferred dividends. 
D) Property taxes estimated and unpaid based on the prior year's municipal tax bill. 
A) A deposit received from a customer for the February 2017 rent on a 1-year lease entered into on March 1,2016. 
B) Unpaid payroll taxes. 
C) Dividends in arrears on preferred dividends. 
D) Property taxes estimated and unpaid based on the prior year's municipal tax bill.

Question 8

Which statement is not correct?

Accepted Answer

A) Private enterprises may follow IFRS. 
B) Private enterprises may follow ASPE. 
C) Not-for-profit organizations may follow IFRS. 
D) Government organizations must follow IFRS. 
A) Private enterprises may follow IFRS. 
B) Private enterprises may follow ASPE. 
C) Not-for-profit organizations may follow IFRS. 
D) Government organizations must follow IFRS.

Question 9

Which is not a criteria for recognition of financial information in the IFRS Conceptual Framework?

Accepted Answer

A) The amount is reasonably measurable. 
B) The expenses should be matched with revenues. 
C) The amount must be measured at historical cost. 
D) Inflow or outflow of cash flows are probable. 
A) The amount is reasonably measurable. 
B) The expenses should be matched with revenues. 
C) The amount must be measured at historical cost. 
D) Inflow or outflow of cash flows are probable.

Question 10

Which organization oversees accounting standards in Canada?

Accepted Answer

A) Financial Accounting Standards Board. 
B) Chartered Professional Accountants of each province. 
C) Chartered Professional Accountants of Canada. 
D) International Accounting Standards Board. 
A) Financial Accounting Standards Board. 
B) Chartered Professional Accountants of each province. 
C) Chartered Professional Accountants of Canada. 
D) International Accounting Standards Board.

Question 11

Which is not an example of trade-offs made in the IFRS Conceptual Framework?

Accepted Answer

A) Relevance versus representational faithfulness. 
B) Comparability versus consistency. 
C) Physical capital versus financial capital. 
D) Timeliness versus verifiability. 
A) Relevance versus representational faithfulness. 
B) Comparability versus consistency. 
C) Physical capital versus financial capital. 
D) Timeliness versus verifiability.

Question 12

Financial statements under the IFRS Conceptual Framework do not help users with what kind of objective(s)?

Accepted Answer

A) Alleviating moral hazard. 
B) Forecasting future product growth. 
C) Prediction of future earnings. 
D) Evaluating the riskiness of an investment. 
A) Alleviating moral hazard. 
B) Forecasting future product growth. 
C) Prediction of future earnings. 
D) Evaluating the riskiness of an investment.

Question 13

Which is a purpose of the conceptual framework in accounting?

Accepted Answer

A) To support principles-based accounting standards,principles and practices. 
B) To provide rules from which decision-useful financial information can be developed. 
C) To promote global consistency,acceptance and adoption of IFRS around the globe. 
D) To develop different accounting practices between countries around the globe. 
A) To support principles-based accounting standards,principles and practices. 
B) To provide rules from which decision-useful financial information can be developed. 
C) To promote global consistency,acceptance and adoption of IFRS around the globe. 
D) To develop different accounting practices between countries around the globe.

Question 14

Which of the following characteristic of financial information alleviates "information asymmetry"?

Accepted Answer

A) Completeness. 
B) Verifiability. 
C) Confirmatory value. 
D) Materiality. 
A) Completeness. 
B) Verifiability. 
C) Confirmatory value. 
D) Materiality.

Question 15

Which is not an element of financial information in the IFRS Conceptual Framework?

Accepted Answer

A) Other comprehensive income. 
B) Assets. 
C) Income. 
D) Liabilities. 
A) Other comprehensive income. 
B) Assets. 
C) Income. 
D) Liabilities.

Question 16

Who are not users of financial information under the IFRS Conceptual Framework?

Accepted Answer

A) Present investors. 
B) Potential investors. 
C) Creditors. 
D) Management. 
A) Present investors. 
B) Potential investors. 
C) Creditors. 
D) Management.

Question 17

Which of the following accurately describes the objective of financial reporting under the IFRS Conceptual Framework?

Accepted Answer

A) The Conceptual Framework focuses on a narrow set of users such as investors and lenders. 
B) Special purpose financial statements are required under the Conceptual Framework. 
C) In the Conceptual Framework,users include a broad range such as employees and customers. 
D) Under the Conceptual Framework,general purpose financial statements increase moral hazard. 
A) The Conceptual Framework focuses on a narrow set of users such as investors and lenders. 
B) Special purpose financial statements are required under the Conceptual Framework. 
C) In the Conceptual Framework,users include a broad range such as employees and customers. 
D) Under the Conceptual Framework,general purpose financial statements increase moral hazard.

Question 18

Which of the following accurately describes the standard setting process in Canada?

Accepted Answer

A) The Accounting Standards Oversight Council approves the IFRS. 
B) The Accounting Standards Board has no authority to alter IFRS. 
C) The IFRS are jointly set by the Accounting Standards Board and the IASB. 
D) The Public Sector Accounting Board oversees standards for private enterprises. 
A) The Accounting Standards Oversight Council approves the IFRS. 
B) The Accounting Standards Board has no authority to alter IFRS. 
C) The IFRS are jointly set by the Accounting Standards Board and the IASB. 
D) The Public Sector Accounting Board oversees standards for private enterprises.

Question 19

Which of the following is not correct about the conceptual framework in accounting?

Accepted Answer

A) It is the basis for standard-setting for accounting standard setting bodies. 
B) It is based on fundamental accounting truths derived from the laws of nature. 
C) It can be used to solve emerging or complex accounting problems. 
D) It can be used to develop consistent and comparable accounting principles. 
A) It is the basis for standard-setting for accounting standard setting bodies. 
B) It is based on fundamental accounting truths derived from the laws of nature. 
C) It can be used to solve emerging or complex accounting problems. 
D) It can be used to develop consistent and comparable accounting principles.

Question 20

What is the most commonly used measurement basis?

Accepted Answer

A) Current cost. 
B) Realizable value. 
C) Historical cost. 
D) Present value. 
A) Current cost. 
B) Realizable value. 
C) Historical cost. 
D) Present value.

When are financial items recognized in the financial statements?

Which statement best explains the qualitative characteristic of "completeness"?

Which statement best explains the meaning of "measurement" in financial reporting?

Which statement best explains the meaning of "presentation" in financial reporting?

In which of the following transactions would it not be appropriate to recognize an asset in the financial statements?

Which of the following is not a purpose of a conceptual framework of accounting concepts and financial reporting objectives?

Maybel Company has a March 31,2016 year end.Which of the following should not be recorded as a current liability?

Which statement is not correct?

Which is not a criteria for recognition of financial information in the IFRS Conceptual Framework?

Which organization oversees accounting standards in Canada?

Which is not an example of trade-offs made in the IFRS Conceptual Framework?

Financial statements under the IFRS Conceptual Framework do not help users with what kind of objective(s)?

Which is a purpose of the conceptual framework in accounting?

Which of the following characteristic of financial information alleviates "information asymmetry"?

Which is not an element of financial information in the IFRS Conceptual Framework?

Who are not users of financial information under the IFRS Conceptual Framework?

Which of the following accurately describes the objective of financial reporting under the IFRS Conceptual Framework?

Which of the following accurately describes the standard setting process in Canada?

Which of the following is not correct about the conceptual framework in accounting?

What is the most commonly used measurement basis?

Fundamentals of Financial Accounting Theory

Accrual Accounting

Revenue and Recognition

Cash and Receivables

Inventories

Financial Assets

Property, plant and Equipment

Intangible Assets, goodwill, mineral Resources, and Government Grants

Applications of Fair Value to Non-Current Assets

Filters

Exam 2: Conceptual Frameworks for Financial Reporting

When are financial items recognized in the financial statements?

Which statement best explains the qualitative characteristic of "completeness"?

Which statement best explains the meaning of "measurement" in financial reporting?

Which statement best explains the meaning of "presentation" in financial reporting?

In which of the following transactions would it not be appropriate to recognize an asset in the financial statements?

Which of the following is not a purpose of a conceptual framework of accounting concepts and financial reporting objectives?

Maybel Company has a March 31,2016 year end.Which of the following should not be recorded as a current liability?

Which statement is not correct?

Which is not a criteria for recognition of financial information in the IFRS Conceptual Framework?

Which organization oversees accounting standards in Canada?

Which is not an example of trade-offs made in the IFRS Conceptual Framework?

Financial statements under the IFRS Conceptual Framework do not help users with what kind of objective(s)?

Which is a purpose of the conceptual framework in accounting?

Which of the following characteristic of financial information alleviates "information asymmetry"?

Which is not an element of financial information in the IFRS Conceptual Framework?

Who are not users of financial information under the IFRS Conceptual Framework?

Which of the following accurately describes the objective of financial reporting under the IFRS Conceptual Framework?

Which of the following accurately describes the standard setting process in Canada?

Which of the following is not correct about the conceptual framework in accounting?

What is the most commonly used measurement basis?

Fundamentals of Financial Accounting Theory

Accrual Accounting

Revenue and Recognition

Cash and Receivables

Inventories

Financial Assets

Property, plant and Equipment

Intangible Assets, goodwill, mineral Resources, and Government Grants

Applications of Fair Value to Non-Current Assets

Filters