Question 1

According to AASB 101 Presentation of Financial Statements,a required format for the presentation of a statement of financial position is:

Accepted Answer

A) not prescribed and no guidance is provided in the standard. 
B) not prescribed but guidance is provided in the standard for a suitable format. 
C) prescribed by the standard. 
D) prescribed by the Corporations Act. 
A) not prescribed and no guidance is provided in the standard. 
B) not prescribed but guidance is provided in the standard for a suitable format. 
C) prescribed by the standard. 
D) prescribed by the Corporations Act. B

Question 2

All items of income and expense that arise during a financial period must be included in profit or loss.
e.g.changes in a revaluation surplus.These items are not included in the determination of the profit or loss that arose during a financial period.Instead,the balance of equity is directly adjusted.

Accepted Answer

A) True 
 B)False  False

Question 3

Which of the following statements is incorrect?

Accepted Answer

A) Current assets are those assets that are realised or consumed within an entity's operating cycle. 
B) For entities with diverse operations,such as retail and banking activities,a mixed basis of presentation may be appropriate. 
C) An entity's operating cycle is usually 12 months but may be longer than 12 months after the reporting period. 
D) An entity is permitted to classify deferred tax assets as current assets. 
A) Current assets are those assets that are realised or consumed within an entity's operating cycle. 
B) For entities with diverse operations,such as retail and banking activities,a mixed basis of presentation may be appropriate. 
C) An entity's operating cycle is usually 12 months but may be longer than 12 months after the reporting period. 
D) An entity is permitted to classify deferred tax assets as current assets. D

Question 4

A reporting entity must disclose somewhere in the financial report,which of the following items of information?
I.The legal residence and form of the entity.
II.The name and location of the stock exchange on which the entity's securities are traded.
III.The address of the registered office.
IV.The country of incorporation.

Accepted Answer

A) I,II,III and IV 
B) II,II and IV only 
C) I,II and IV only 
D) I,III and IV only 
A) I,II,III and IV 
B) II,II and IV only 
C) I,II and IV only 
D) I,III and IV only

Question 5

The amount of dividends recognised as distributions to shareholders must be disclosed in the statement of changes in equity.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following items must be presented as a separate line item on the face of a statement of profit or loss and other comprehensive income?

Accepted Answer

A) Cost of sales 
B) Share of profit or loss of associates and joint ventures 
C) Wages and salaries expense 
D) Share of profit or loss of subsidiaries 
A) Cost of sales 
B) Share of profit or loss of associates and joint ventures 
C) Wages and salaries expense 
D) Share of profit or loss of subsidiaries

Question 7

Current assets are those assets that are realised or consumed within an entity's operating cycle.

Accepted Answer

A) True 
 B)False

Question 8

The time between the acquisition of assets for processing and their realisation into cash or cash equivalents is known as the:

Accepted Answer

A) acquisition cycle. 
B) payment cycle. 
C) operating cycle. 
D) realisation cycle. 
A) acquisition cycle. 
B) payment cycle. 
C) operating cycle. 
D) realisation cycle.

Question 9

An entity must present a complete set of financial statements at least annually.

Accepted Answer

A) True 
 B)False

Question 10

Assets and liabilities,and income and expenses are not to be offset unless:

Accepted Answer

A) they are financial assets and liabilities. 
B) they are in respect of borrowing and lending activities such as interest revenue and interest expense. 
C) required or permitted by an Australian accounting standard. 
D) the auditors approve the offset. 
A) they are financial assets and liabilities. 
B) they are in respect of borrowing and lending activities such as interest revenue and interest expense. 
C) required or permitted by an Australian accounting standard. 
D) the auditors approve the offset.

Question 11

AASB 101 Presentation of Financial Statements requires entities to disclose within the financial statements a description of the nature of the entity's operations and principal activities.

Accepted Answer

A) True 
 B)False

Question 12

AASB 101 Presentation of Financial Statements requires each class of share capital to be separately disclosed on the face of the statement of financial position.

Accepted Answer

A) True 
 B)False

Question 13

According to AASB 101 Presentation of Financial Statements,a complete set of financial statements only comprises a statement of financial position,statement of profit or loss and other comprehensive income and a statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 14

Profit or loss is the total of income less expenses:

Accepted Answer

A) including the items of other comprehensive income. 
B) excluding abnormal items. 
C) excluding the items of other comprehensive income. 
D) excluding extraordinary items. 
A) including the items of other comprehensive income. 
B) excluding abnormal items. 
C) excluding the items of other comprehensive income. 
D) excluding extraordinary items.

Question 15

Extraordinary items of income and expense:

Accepted Answer

A) must be disclosed in the statement of profit or loss and other comprehensive income. 
B) were previously disclosed together with the entity's normal trading activities. 
C) must be disclosed in the notes to the financial statements. 
D) are prohibited from being disclosed either in the statement of profit or loss and other comprehensive income or in the notes. 
A) must be disclosed in the statement of profit or loss and other comprehensive income. 
B) were previously disclosed together with the entity's normal trading activities. 
C) must be disclosed in the notes to the financial statements. 
D) are prohibited from being disclosed either in the statement of profit or loss and other comprehensive income or in the notes.

Question 16

AASB 101 Presentation of Financial Statements,requires which of the following items to be disclosed separately on the face of the statement of profit or loss and other comprehensive income?
I Cost of sales
II Revenue
III Finance costs
IV Share of the profit or loss from associates
V Audit and non-audit fees
VI Total other comprehensive income
VII Profit or loss

Accepted Answer

A) I,II,VI and VII only 
B) I,II,III and V only 
C) II,III,IV,VI and VII only 
D) I,III,V and VII only 
A) I,II,VI and VII only 
B) I,II,III and V only 
C) II,III,IV,VI and VII only 
D) I,III,V and VII only

Question 17

Categorising expenses as distribution costs and administration expenses is an example of which classification method?

Accepted Answer

A) Nature of expense method 
B) Function of expense method 
C) Purpose of expense method 
D) None of the above 
A) Nature of expense method 
B) Function of expense method 
C) Purpose of expense method 
D) None of the above

Question 18

Which of the following items are disclosed on the face of a statement of financial position as line items?

Accepted Answer

A) Finance costs 
B) Cost of sales 
C) Interest revenue 
D) Biological assets 
A) Finance costs 
B) Cost of sales 
C) Interest revenue 
D) Biological assets

Question 19

The definition of 'social responsibility' also refers to government agencies and departments.

Accepted Answer

A) True 
 B)False

Question 20

The following are normally presented in a statement of financial position as current items:

Accepted Answer

A) deferred tax liabilities. 
B) accounts payable. 
C) deferred tax assets. 
D) property,plant and equipment. 
A) deferred tax liabilities. 
B) accounts payable. 
C) deferred tax assets. 
D) property,plant and equipment.

Exam 15: Disclosure: Presentation of Financial Statements

According to AASB 101 Presentation of Financial Statements,a required format for the presentation of a statement of financial position is:

Which of the following statements is incorrect?

The amount of dividends recognised as distributions to shareholders must be disclosed in the statement of changes in equity.

Which of the following items must be presented as a separate line item on the face of a statement of profit or loss and other comprehensive income?

Current assets are those assets that are realised or consumed within an entity's operating cycle.

The time between the acquisition of assets for processing and their realisation into cash or cash equivalents is known as the:

An entity must present a complete set of financial statements at least annually.

Assets and liabilities,and income and expenses are not to be offset unless:

AASB 101 Presentation of Financial Statements requires entities to disclose within the financial statements a description of the nature of the entity's operations and principal activities.

AASB 101 Presentation of Financial Statements requires each class of share capital to be separately disclosed on the face of the statement of financial position.

According to AASB 101 Presentation of Financial Statements,a complete set of financial statements only comprises a statement of financial position,statement of profit or loss and other comprehensive income and a statement of cash flows.

Profit or loss is the total of income less expenses:

Extraordinary items of income and expense:

Categorising expenses as distribution costs and administration expenses is an example of which classification method?

Which of the following items are disclosed on the face of a statement of financial position as line items?

The definition of 'social responsibility' also refers to government agencies and departments.

The following are normally presented in a statement of financial position as current items:

Nature and Regulation of Companies

Financing Company Operations

Company Operations

Fundamental Concepts of Corporate Governance

Fair Value Measurement

Accounting for Company Income Tax

Financial Instruments

Foreign Currency Transactions and Forward Exchange Contracts

Property, Plant and Equipment

Leases

Intangible Assets

Business Combinations

Impairment of Assets

Disclosure: Legal Requirements and Accounting Polices

Disclosure: Statement of Cash Flows

Disclosure: Translation of Financial Statements Into a Presentation Currency

Consolidation: Controlled Entities

Consolidation: Wholly Owned Subsidiaries

Consolidation: Intragroup Transactions

Consolidation: Non-Controlling Interest

Consolidation: Other Issues

Associates and Joint Ventures

Investments in Joint Arrangements

Insolvency and Liquidation

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