Question 1

Which of the following countries do not use a common law system?

Accepted Answer

A)  The United States 
B)  Germany 
C)  The United Kingdom 
D)  Both a and c are correct.

Question 2

The state of economic development can affect accounting standards.

Accepted Answer

A) True 
 B)False

Question 3

IFRS is now mandatory in all member states of the economic and political organization known as the European Union.

Accepted Answer

A) True 
 B)False

Question 4

Explain the meaning of the terms contingent liabilities and provisions as they relate to U.S.GAAP and IFRS?

Accepted Answer

The answer of Explain the meaning of the terms contingent...

Question 5

Which of the following statements is false regarding the reasons for differing accounting systems around the world?

Accepted Answer

A)  Countries that have strong political and economic ties often share similar accounting
Practices. 
B)  Canada and Mexico, two former British colonies, can trace their accounting roots to those found in the United Kingdom. 
C)  The state of economic development typically mirrors the development stage of accounting rules in countries. 
D)  In some less-developed countries of the world, where the forces of capitalism are less prevalent, accounting standards have developed at a much slower pace than they have in more advanced economies.

Question 6

Which of the following statements is true regarding the treatment of leases on the financial statements?

Accepted Answer

A)  U.S.GAAP prohibits the presentation of leases on the financial statements since they are off-balance sheet transactions. 
B)  U.S.GAAP criteria for lease capitalization are less strict than IFRS. 
C)  The criteria concerning whether a lease is a capital lease are very different for IFRS and U.S.GAAP. 
D)  The criteria required for lease capitalization under IFRS are considered more like guidelines rather than strict rules.

Question 7

Which of the following presents the proper ordering of assets, liabilities and equities on the statement of financial position used by some countries that is different from the U.S.?

Accepted Answer

A)  current assets, long-term assets, current liabilities 
B)  inventories, trade-receivables, cash 
C)  assets, liabilities, equities 
D)  current liabilities, long-term liabilities, equities

Question 8

Which of the following statements regarding inflation and accounting is false?

Accepted Answer

A)  The SEC requires U.S.companies to present supplemental financial information adjusted for the effects of inflation. 
B)  Instability of the measuring unit that is the currency occurs in countries with rampant inflation. 
C)  In some in Latin American and South American countries, companies have been required to
Adjust their financial statements to take into account the effects of inflation. 
D)  The FASB developed rules for companies in the United States to use to adjust for inflation.

Question 9

All of the following statements are true about inflation except:

Accepted Answer

A)  U.S.companies no longer present financial information adjusted for the effects of inflation. 
B)  In recent years, inflation has been more rampant in Latin America and South America than the rest of the world. 
C)  The FASB developed rules for companies in the United States to use to adjust for inflation. 
D)  The U.S.and Germany adjust their financial statements for inflation.

Question 10

A single set of accounting standards could help a U.S.company save time and money in the acquisition of a German company.

Accepted Answer

A) True 
 B)False

Question 11

The benefits of a single set of accounting standards used around the world would include all of the following except:

Accepted Answer

A)  They would eventually save companies considerable money in accounting fees. 
B)  They would prevent competitors from acquiring each other. 
C)  They would allow easier comparisons by analysts and investors. 
D)  They would facilitate access to foreign capital markets.

Question 12

Companies in Mexico had to begin using IFRS by 2020.

Accepted Answer

A) True 
 B)False

Question 13

Essentially, the entire statement of financial position is inverted compared to what is commonly seen in the United States.

Accepted Answer

A) True 
 B)False

Question 14

Japan has a greater number of differences than the U.S.between the amount of income reported to stockholders and that reported to the taxing authorities.

Accepted Answer

A) True 
 B)False

Question 15

While U.S.GAAP requires a complete set of financial statements, including a balance sheet, statement of stockholders' equity, income statement, and statement of cash flows, IFRS does not.

Accepted Answer

A) True 
 B)False

Question 16

What is the name of the formalized commitment of the IASB and the FASB to converge U.S.and international accounting standards?

Accepted Answer

A)  The Sarbanes-Oxley Act 
B)  The Norwalk Agreement 
C)  The IFRS Foundation 
D)  The Conceptual Framework

Exam 14: Exploring Accounting Standards and Differences around the World

Which of the following countries do not use a common law system?

The state of economic development can affect accounting standards.

IFRS is now mandatory in all member states of the economic and political organization known as the European Union.

Explain the meaning of the terms contingent liabilities and provisions as they relate to U.S.GAAP and IFRS?

Which of the following statements is false regarding the reasons for differing accounting systems around the world?

Which of the following statements is true regarding the treatment of leases on the financial statements?

Which of the following presents the proper ordering of assets, liabilities and equities on the statement of financial position used by some countries that is different from the U.S.?

Which of the following statements regarding inflation and accounting is false?

All of the following statements are true about inflation except:

A single set of accounting standards could help a U.S.company save time and money in the acquisition of a German company.

The benefits of a single set of accounting standards used around the world would include all of the following except:

Companies in Mexico had to begin using IFRS by 2020.

Essentially, the entire statement of financial position is inverted compared to what is commonly seen in the United States.

Japan has a greater number of differences than the U.S.between the amount of income reported to stockholders and that reported to the taxing authorities.

While U.S.GAAP requires a complete set of financial statements, including a balance sheet, statement of stockholders' equity, income statement, and statement of cash flows, IFRS does not.

What is the name of the formalized commitment of the IASB and the FASB to converge U.S.and international accounting standards?