Question 1

Under IFRS 8,certain reconciliations,such as total reportable segment revenues to the entity's revenues,are required.Why are these reconciliations required?

Accepted Answer

A) To prove that the consolidated financial statements balance 
B) To ensure that all reportable segments have been identified 
C) To show the relative contribution of each segment to the total 
D) To show how reportable segments were identified 
A) To prove that the consolidated financial statements balance 
B) To ensure that all reportable segments have been identified 
C) To show the relative contribution of each segment to the total 
D) To show how reportable segments were identified C

Question 2

Yang Ltd.will issue interim financial statements for its second quarter.Which statement(s)must report details of the second quarter as well as for the year-to-date?

Accepted Answer

A) Statement of comprehensive income only 
B) Statement of changes in equity only 
C) Statement of comprehensive income and statement of changes in equity only 
D) Statement of comprehensive income,statement of changes in equity,and statement of cash flows only 
A) Statement of comprehensive income only 
B) Statement of changes in equity only 
C) Statement of comprehensive income and statement of changes in equity only 
D) Statement of comprehensive income,statement of changes in equity,and statement of cash flows only A

Question 3

Faulk Ltd.has provided the following information:
 
Under the revenue test only,which segments are reportable?

Accepted Answer

A) Segments A and C only 
B) Segments B and D only 
C) Segments B,C,and D only 
D) All the segments are reportable. 
A) Segments A and C only 
B) Segments B and D only 
C) Segments B,C,and D only 
D) All the segments are reportable. C

Question 4

Which of the following is not a requirement in defining an operating segment?

Accepted Answer

A) The particular component must be generating revenue. 
B) The particular component's operating results must be reviewed regularly by responsible company officers. 
C) The particular component's financial information is routinely available through the organization's financial reporting system. 
D) The particular component incurs expenses in its normal cost of activities. 
A) The particular component must be generating revenue. 
B) The particular component's operating results must be reviewed regularly by responsible company officers. 
C) The particular component's financial information is routinely available through the organization's financial reporting system. 
D) The particular component incurs expenses in its normal cost of activities.

Question 5

An organization has identified the following segments:
 
Which of the identifiable segments above are reportable?

Accepted Answer

A) Segments A,B,and C only 
B) Segments B,C,and E only 
C) Segments B and C only 
D) Segments A,B,C,and E only 
A) Segments A,B,and C only 
B) Segments B,C,and E only 
C) Segments B and C only 
D) Segments A,B,C,and E only

Question 6

Sharst Link Company (SLC)is a public company and must file interim statements.SLC experienced the following events during the 3rd quarter of 20X9:
1.A large marketing plan was rolled out for a new product costing $9,000,000.The plan is expected to drive sales for the next four quarters.
2.A law suit was settled and the company must pay $15 million within the next 90 days.There was no payment made by the end of the 3rd quarter.In previous quarters,there was no provision made for this settlement since it was determined to be not probable.
3.Goodwill was tested for impairment and determined to have an impairment loss of $10 million.
4.In the previous interim period,due to a significant drop in the selling price of the inventory,the inventory was written down to its net realizable value $9 million from a cost of $10 million.In this quarter,the inventory is still on hand and the circumstances have again changed,resulting in the net realizable value increasing to $12 million.
5.Customers earn volume rebates when annual sales volumes exceed $6 million.This is a contractual agreement that the company has made to pay rebates of 4% on total sales for the year once the amount of $6 million is achieved.Currently,there were sales of $2 million to one customer for the quarter.In each of the previous quarters,sales of $1.5 million had been made to this customer.It is expected that sales of $2 million will be made in quarter 4 to this customer also.
Required:
For each event,indicate the impact on the interim statement for the 3rd quarter using the guidance required by IAS 34.

Accepted Answer

The discussion below outlines the treatm

Question 7

Faulk Ltd.has provided the following information:
 
Under the asset test only,which segments are reportable?

Accepted Answer

A) Segments A,B,and C only 
B) Segments A and D only 
C) Segments B and C only 
D) All the segments are reportable. 
A) Segments A,B,and C only 
B) Segments A and D only 
C) Segments B and C only 
D) All the segments are reportable.

Question 8

Ravens Inc.sells office furniture including desks,chairs,partitioning walls and office supplies in more than 6 countries.The company is publicly traded and files annual statements with the securities regulator.The following information was provided by the controller for the most recent year ended December 31,20X9.

Accepted Answer

Ravens Inc.is a public company and must

Question 9

Under IAS 34,companies generally should use the discrete approach for interim reporting.However,IAS 34 outlines exceptions to this rule.Explain what these exceptions are and how they are treated in interim reports.What argument does IAS 34 provide for this treatment?

Accepted Answer

IAS 34 specifically discusses year-end b

Question 10

Which of the following is not a threshold for identifying a reportable segment?

Accepted Answer

A) The segment contributes at least 10% of the organization's total revenues. 
B) The segment contributes at least 10% of the organization's operating profits. 
C) The segment contributes at least 10% of the organization's combined assets of all operating segments. 
D) The segment contributes at least 10% of the organization's total expenses. 
A) The segment contributes at least 10% of the organization's total revenues. 
B) The segment contributes at least 10% of the organization's operating profits. 
C) The segment contributes at least 10% of the organization's combined assets of all operating segments. 
D) The segment contributes at least 10% of the organization's total expenses.

Question 11

When can benefits of an income tax loss in an interim period not be recognized in that period?

Accepted Answer

A) If the loss will be offset by taxable income later in that year 
B) If the loss can be used as a loss carryback 
C) If it is more likely than not that a tax loss carry forward benefit will be realized 
D) If the loss occurs in the first interim period 
A) If the loss will be offset by taxable income later in that year 
B) If the loss can be used as a loss carryback 
C) If it is more likely than not that a tax loss carry forward benefit will be realized 
D) If the loss occurs in the first interim period

Question 12

In practice,most companies use the discrete approach in preparing their internal interim financial statements.Which of the following costs is usually not included in the financial statements?

Accepted Answer

A) Insurance 
B) Income taxes 
C) Maintenance 
D) Bonuses to employees 
A) Insurance 
B) Income taxes 
C) Maintenance 
D) Bonuses to employees

Question 13

Faulk Ltd.has provided the following information:
 
Using all the applicable tests,which segments are reportable?

Accepted Answer

A) Segments B and C only 
B) Segments B,C,and D only 
C) Segment D only 
D) All the segments are reportable. 
A) Segments B and C only 
B) Segments B,C,and D only 
C) Segment D only 
D) All the segments are reportable.

Question 14

Faulk Ltd.has provided the following information:
 
Under the profit test only,which segments are reportable?

Accepted Answer

A) Segment A only 
B) Segment C only 
C) Segments A and C only 
D) Segments C and D only 
A) Segment A only 
B) Segment C only 
C) Segments A and C only 
D) Segments C and D only

Question 15

The recommendation for interim income tax expense requires the use of which of the following rates in the first quarter?

Accepted Answer

A) Estimated average 
B) Marginal 
C) Applicable progressive 
D) Loss carryforward 
A) Estimated average 
B) Marginal 
C) Applicable progressive 
D) Loss carryforward

Question 16

In Canada and the United States,at a minimum,how often are interim financial statements required to be issued?

Accepted Answer

A) Monthly 
B) Bi-monthly 
C) Quarterly 
D) Semi-annually 
A) Monthly 
B) Bi-monthly 
C) Quarterly 
D) Semi-annually

Question 17

There is certain information that reportable segments are required to disclose only if that information is regularly reviewed by the chief operating decision-maker.Which of the following must be disclosed even if it is not regularly reviewed by the chief operating decision-maker?

Accepted Answer

A) Measure of profit/loss 
B) Amortization and depreciation 
C) Income tax expense/benefit 
D) Interest revenue and expense 
A) Measure of profit/loss 
B) Amortization and depreciation 
C) Income tax expense/benefit 
D) Interest revenue and expense

Question 18

The following information on sales and operating profit is available for the company's three operating segments (in 000s):
 
Which of the operating segments must be reported separately?

Accepted Answer

A) Only Segment E 
B) Only Segments D and F 
C) Only Segments E and F 
D) Segments D,E and F 
A) Only Segment E 
B) Only Segments D and F 
C) Only Segments E and F 
D) Segments D,E and F

Question 19

Which of the following is not an aspect in identifying an operating segment?

Accepted Answer

A) The business component's operating results are reviewed regularly by the enterprise's chief operating decision maker. 
B) It is a component of the enterprise that is expected to generate revenues and expenses. 
C) Discrete financial information on the business component is regularly available through the company's financial reporting system. 
D) Other companies in the same industry use similar operating segments. 
A) The business component's operating results are reviewed regularly by the enterprise's chief operating decision maker. 
B) It is a component of the enterprise that is expected to generate revenues and expenses. 
C) Discrete financial information on the business component is regularly available through the company's financial reporting system. 
D) Other companies in the same industry use similar operating segments.

Question 20

HB Company is a private company with a significant amount of long-term debt.The company reports under IFRS.One of the conditions of the debt-financing indenture is that it must provide quarterly financial statements to the lender.HB pays tax at the rate of 20% on the first $200,000 of income and 40% on any income in excess of $200,000.During 20X5,the company earned $500,000 and paid tax at an average rate of 32%.Similar results were expected for 20X6.
HB realized the following actual results for the year ended December 31,20X6 (in thousands):   
Required:
Calculate income tax expense (recovery)for each quarter in 20X6 and for the year in total under the:
a.discrete approach
b.integral approach

Accepted Answer

a.Discrete approach

Under IFRS 8,certain reconciliations,such as total reportable segment revenues to the entity's revenues,are required.Why are these reconciliations required?

Yang Ltd.will issue interim financial statements for its second quarter.Which statement(s)must report details of the second quarter as well as for the year-to-date?

Faulk Ltd.has provided the following information: Under the revenue test only,which segments are reportable?

Which of the following is not a requirement in defining an operating segment?

An organization has identified the following segments: Which of the identifiable segments above are reportable?

Faulk Ltd.has provided the following information: Under the asset test only,which segments are reportable?

Under IAS 34,companies generally should use the discrete approach for interim reporting.However,IAS 34 outlines exceptions to this rule.Explain what these exceptions are and how they are treated in interim reports.What argument does IAS 34 provide for this treatment?

Which of the following is not a threshold for identifying a reportable segment?

When can benefits of an income tax loss in an interim period not be recognized in that period?

In practice,most companies use the discrete approach in preparing their internal interim financial statements.Which of the following costs is usually not included in the financial statements?

Faulk Ltd.has provided the following information: Using all the applicable tests,which segments are reportable?

Faulk Ltd.has provided the following information: Under the profit test only,which segments are reportable?

The recommendation for interim income tax expense requires the use of which of the following rates in the first quarter?

In Canada and the United States,at a minimum,how often are interim financial statements required to be issued?

There is certain information that reportable segments are required to disclose only if that information is regularly reviewed by the chief operating decision-maker.Which of the following must be disclosed even if it is not regularly reviewed by the chief operating decision-maker?

The following information on sales and operating profit is available for the company's three operating segments (in 000s): Which of the operating segments must be reported separately?

Which of the following is not an aspect in identifying an operating segment?

Setting the Stage

Intercorporate Equity Investments: an Introduction

Business Combinations

Wholly-Owned Subsidiaries: Reporting Subsequent to Acquisition

Consolidation of Non-Wholly Owned Subsidiaries

Subsequent-Year Consolidations: General Approach

Foreign Currency Transactions and Hedges

Reporting Foreign Operations

Financial Reporting for Not-For-Profit Organizations

Public Sector Financial Reporting

Income Tax Allocation

Income Tax Allocation Subsequent to Acquisition

Good will Impairment Test

Step Purchases

Decreases in Ownership Interest

Preferred and Restricted Shares of Investee Corporation

Intercompany Bond Holdings

Fund Accounting

Filters

Exam 7: Segmented and Interim Reporting

Under IFRS 8,certain reconciliations,such as total reportable segment revenues to the entity's revenues,are required.Why are these reconciliations required?

Yang Ltd.will issue interim financial statements for its second quarter.Which statement(s)must report details of the second quarter as well as for the year-to-date?

Faulk Ltd.has provided the following information: Under the revenue test only,which segments are reportable?

Which of the following is not a requirement in defining an operating segment?

An organization has identified the following segments: Which of the identifiable segments above are reportable?

Faulk Ltd.has provided the following information: Under the asset test only,which segments are reportable?

Under IAS 34,companies generally should use the discrete approach for interim reporting.However,IAS 34 outlines exceptions to this rule.Explain what these exceptions are and how they are treated in interim reports.What argument does IAS 34 provide for this treatment?

Which of the following is not a threshold for identifying a reportable segment?

When can benefits of an income tax loss in an interim period not be recognized in that period?

In practice,most companies use the discrete approach in preparing their internal interim financial statements.Which of the following costs is usually not included in the financial statements?

Faulk Ltd.has provided the following information: Using all the applicable tests,which segments are reportable?

Faulk Ltd.has provided the following information: Under the profit test only,which segments are reportable?

The recommendation for interim income tax expense requires the use of which of the following rates in the first quarter?

In Canada and the United States,at a minimum,how often are interim financial statements required to be issued?

There is certain information that reportable segments are required to disclose only if that information is regularly reviewed by the chief operating decision-maker.Which of the following must be disclosed even if it is not regularly reviewed by the chief operating decision-maker?

The following information on sales and operating profit is available for the company's three operating segments (in 000s): Which of the operating segments must be reported separately?

Which of the following is not an aspect in identifying an operating segment?

Setting the Stage

Intercorporate Equity Investments: an Introduction

Business Combinations

Wholly-Owned Subsidiaries: Reporting Subsequent to Acquisition

Consolidation of Non-Wholly Owned Subsidiaries

Subsequent-Year Consolidations: General Approach

Foreign Currency Transactions and Hedges

Reporting Foreign Operations

Financial Reporting for Not-For-Profit Organizations

Public Sector Financial Reporting

Income Tax Allocation

Income Tax Allocation Subsequent to Acquisition

Good will Impairment Test

Step Purchases

Decreases in Ownership Interest

Preferred and Restricted Shares of Investee Corporation

Intercompany Bond Holdings

Fund Accounting

Filters