You correctly answered54out of98questions with an accuracy
of55.1%.You gained980experience points!Question 1Minimum lease
payments may include aany of thesebargain purchase optionpenalty
for failure to renewguaranteed residual valueTheory of Accounts -
Finance Lease - Lessee (Easy)Question 2Which of the following is
usually considered cash?Postdated checkMoney market savings
certificatesCertificates of depositChecking accountsTheory of
Accounts - Cash and Cash Equivalents (Easy)Question 3Limitations of
the income statement include all of the following, exceptOnly
actual amounts are reported in determining net income.Items that
cannot be measured reliably are not reported.Income numbers are
affected by the accounting methods employed.Income measurement
involves judgment.Theory of Accounts - Statement of Comprehensive
Income (Average)Question 4Which of the following entities must not
describe its financial statements as being incompliance with the
PFRS for SMEs even if it is allowed by law to prepare its financial
statements in accordance with PFRS for SMEs?IAn entity whose shares
are traded in a public market
IIAn entity whose debt instruments(but nit its shares) are
traded in a public market
IIIAn entity that is in the process of issuing its debt
instruments (but not its shares) fro trading in a public market
I and III onlyI and II onlyI, II and IIIII and III onlyTheory of
Accounts - SME (Average)Question 5Goods on consignment should be
included in the inventory ofThe consignor but not the consigneeThe
consignee but not the consignorBoth the consignor and the
consigneeNeither the consignor nor the consigneeTheory of Accounts
- Inventory Valuation (Average)Question 6Which of the following
assets generally is required to be tested at least annually for
impairment?CopyrightRenewable broadcast
licensePatentMachineryTheory of Accounts - Impairment of Assets
(Average)Question 7A consignee paid the freight costs for goods
shipped form a consignor. These freight costs are to be deducted
from the consignees payment to the consignor when the consignment
goods are sold. Until the consignee sells the goods, the freight
costs should be included in the consigneesAccounts
receivableFreight outCost of goods soldSelling expensesTheory of
Accounts - Inventory Valuation (Easy)Question 8Net assets
restricted by the governing board of a non-government,
not-for-profit organization are reported as part of:Temporarily
restricted net assetsUnrestricted net assetsPermanently restricted
net assetsAny of these, depending on the termsTheory of Accounts -
Not for Profit Organizations (Average)Question 9Which of the
following is not considered investment property?Land to be leased
out under a finance lease.Building held for undetermined
useBuilding being constructed for use as Investment propertyLand
held for capital gainsTheory of Accounts - Investment Property
(Average)Question 10Which two of the following statements are
correct per PAS 16 Property, plant and equipment?AAssets are
depreciated even if their fair value exceeds their carrying
amount.
BLand and buildings are accounted for separately, even when
acquired together.
CA non-current asset acquired as the result of an exchange of
assets is not recognized
DA gain on disposal of a non-current asset is classified as
revenue
A and BA and CB and DA and DTheory of Accounts - Property, Plant
and Equipment (Easy)Question 11A national budget designed wherein
total estimated revenue is more than total estimate
expenditures.Balanced budgetLine item budgetSupplemental
budgetSpecial budgetTheory of Accounts - Government Accounting
(Easy)Question 12Which dividend when declared does not create a
liability?Scrip dividendProperty dividendCash dividendShare
dividendTheory of Accounts - Retained Earnings (Easy)Question 13The
overriding qualitative characteristic of accounting information
isRelevanceFreedom from biasComparabilityUsefulness for decision
makingTheory of Accounts - Conceptual Framework (Average)Question
14An entity sold its headquarters building at a gain and
simultaneously leased back the building. The lease was reported as
a finance lease. At the time of sale, the gain should be reported
asOperating incomeAn asset valuation allowanceComponent of other
comprehensive incomeComponent of shareholders' equityTheory of
Accounts - Sale and Leaseback (Average)Question 15A adjusting entry
that debits an expense and credits a liability is which type?Cash
expenseAccrued expensePrepaid expenseDepreciation expenseTheory of
Accounts - Financial Statements (Easy)Question 16For which of the
following products is it appropriate to recognize revenue at the
completion of production even though no sale has been made?Single
family residential unitsLarge appliancesAutomobilesPrecious
metalsTheory of Accounts - Revenue Recognition (Average)Question
17In determining diluted earnings per share, dividends on
nonconvertible cumulative preferred stock should beadded back to
net income whether declared or notdeducted from net income only if
declareddisregardeddeducted from net income whether declared or
notTheory of Accounts - Diluted Earnings Per Share
(Average)Question 18To compute basic EPS, the amount of preferred
dividends on noncumulative preferred stock should beAdded to net
income, only when declaredDisregardedDeducted from net income,
whether declared or notDeducted from net income, only when
declaredTheory of Accounts - Basic Earnings Per Share
(Easy)Question 19Contingent assets are usually recognized
whenOccurrence is reasonably possible and the amount can be
measured reliablyThe amount can be measured
reliablyRealizedOccurrence is reasonably probable and the amount
can be measured reliablyTheory of Accounts - Provision and
Contingent Liability (Average)Question 20Ian Company is authorized
to issue 50,000 shares of P25 par ordinary share. On May 30, 2014,
Ian issued 20,000 shares at P45 per share. Ians journal entry to
record these facts should include aboth a and ccredit to ordinary
share of P500,000credit to Paid-in Capital in Excess of Par for
P900,000debit to ordinary shares for P900,000SOLUTION:(20,000
shares x P25 = P500,000)Theory of Accounts - Shareholders' Equity
(Easy)Question 21An example of an item which is not an element of
working capital isgoods in process.goodwill.temporary
investments.accrued interest on notes receivable.Theory of Accounts
- Statement of Financial Position (Easy)Question 22An SME shall
capitalize all of the following as cost of property, plant and
equipment, exceptTransport costLoan raising costInstallation
costNonrefundable purchase taxTheory of Accounts - SME
(Average)Question 23A new entity has come out with an offer to
refund the cost of purchase within one month after the sale if the
customer is not satisfied with the product. When should the entity
recognize the revenue?After one month of saleWhen goods are sold to
the customersOnly if goods are not returned by the customers after
the period of one monthAt the time of sale along with an offset to
revenue of the liability of the same amount for the possibility of
the return.Theory of Accounts - Statement of Comprehensive Income
(Average)Question 24On December 31, 2013, special insurance costs,
incurred but unpaid, were not recorded. If these insurance costs
were related to work in process, what is the effect of the omission
on accrued liabilities and retained earnings in the December 31,
2013 balance sheet?Accrued Liabilities (No effect); Retained
Earnings (No effect)Accrued Liabilities (Understated); Retained
Earnings (Overstated)Accrued Liabilities (Understated); Retained
Earnings (No effect)Accrued Liabilities (No effect); Retained
Earnings (Overstated)Theory of Accounts - Error Correction
(Average)Question 25The income statement revealsResources and
equities of an entity at a point in timeNet earnings an entity at a
point in timeNet earnings an entity for a period of timeResources
and equities of an entity for a period of timeTheory of Accounts -
Statement of Comprehensive Income (Easy)Question 26Under PAS 28,
what accounting method should be used for an investment in an
associate where it is operating under severe long-term
restrictions, for example, where the government of the entity has
temporary control over the associate?The associate should be shown
at costThe equity method should be applied if significant influence
can be exertedPAS 39 should be appliedConsolidation method should
be usedTheory of Accounts - Investment In Associate
(Average)Question 27Which of the following terms best describes the
removal of an asset from an entitys statement of financial
position?DepreciationDerecognitionImpairmentWrite-offTheory of
Accounts - Property, Plant and Equipment (Average)Question 28Prior
period errorsDo not cause misstatements in current period FSDo not
reverse themselves in the future in all circumstancesAre corrected
through current profit or lossAre corrected through accumulated
profit or lossTheory of Accounts - Error Correction
(Average)Question 29How should import duties be dealt with when
valuing inventories at the lower of cost and net realizable value
(NRV) according to PAS 2 Inventories?IgnoredAdded to costDeducted
in arriving at NRVDeducted from costTheory of Accounts - Inventory
Valuation (Easy)Question 30Antidilutive securitiesare those whose
inclusion in earnings per share computations would cause basic
earnings per share to exceed diluted earnings per shareshould be
included in the computation of diluted earnings per share but not
basic earnings per shareinclude stock options and warrants whose
exercise price is less than the average market price of common
stockshould be ignored in all earnings per share calculationsTheory
of Accounts - Diluted Earnings Per Share (Average)Question 31This
is defined in PFRS 1 as the "first annual financial statements in
which an entity adopts Philippine Financial Reporting Standards
(PFRS) by an explicit and unreserved statement of compliance with
PFRS"First PFRS financial statementsOpening PFRS statement of
financial positionFirst audited PFRS financial statementsPFRS
financial statementsTheory of Accounts - Conceptual Framework
(Average)Question 32A voluntary health and welfare organization
received a cash donation in the prior year which contained a
donor-imposed restriction which stipulated that the donation could
not be spent until the current year. The organization spent the
donation in the current year for fund raising activities. In the
statement of activities for the current year, the expiration of the
time restriction would result in reportingIncrease in temporarily
restricted net assetsExpense which decreased temporarily restricted
net assetsIncrease in unrestricted net assetsReclassification which
decreased temporarily restricted net assetsTheory of Accounts - Not
for Profit Organizations (Difficult)Question 33The balance in
Common Stock Dividend Distributable should be reported as
a(n)contra current asset.deduction from common stock issued.current
liability.addition to capital stock.Theory of Accounts - Retained
Earnings (Average)Question 34Which of the following best describes
the net effect on retained earnings of the purchase and subsequent
sale of treasury stock?Retained earnings may never be increased but
sometimes decreasedRetained earnings is always affected unless the
reissue price is exactly equal to costRetained earnings may never
be decreased but sometimes increasedRetained earnings may never be
increased or decreasedTheory of Accounts - Shareholders' Equity
(Easy)Question 35Where there is a production cycle of more than one
year, PAS 41 encourages separate disclosure of thePrice change
onlyPhysical change and price changeTotal change in valuePhysical
change onlyTheory of Accounts - Biological Assets (Average)Question
36At the end of the current reporting period, an entity carried a
receivable from a major customer. The customer declared bankruptcy
after the end of reporting period but prior to authorization of
financial statements. How should the entity account for this
event?Ignore the eventMake a provision for this post-reporting
period eventDisclose in the notes the fact that the customer
declared bankruptcyReverse the sale pertaining to this receivable
in the comparative statement for the prior period and treat this as
an error.Theory of Accounts - Provision and Contingent Liability
(Average)Question 37The statement of the financial position of
non-profit organization displays the organizationsAssets, liability
and fund balanceExcess of assets over liabilitiesAssets, liability
and equityAssets, liability and net assetsTheory of Accounts -
Conceptual Framework (Easy)Question 38Which of the following is the
dollar amount recorded when bonds are purchased?The cost of the
bonds is recorded.The amortized cost is recorded.The maturity value
of the bonds is recorded.All of the above terms are the same
amount.Theory of Accounts - Investments (Average)Question 39The
amount of receivables that are hypothecated or pledged against
borrowings should beIncluded in total receivables without
disclosureIncluded in total receivables with disclosureExcluded
from total receivables without disclosureExcluded from total
receivables with disclosureTheory of Accounts - Receivable
Financing (Average)Question 40Which method of recording bad debt
loss is consistent with the accrual accounting?Direct write-off
methodPercent of accounts receivable methodPercent of sales
methodAllowance methodTheory of Accounts - Accounts Receivable
(Average)Question 41Josh Company's December 31 year-end financial
statements contained the following errors:Dec. 31, 2010Dec. 31,
2011
Ending inventoryP7,500 understatedP11,000 overstated
Depreciation expense2,000 understated
An insurance premium of P18,000 was prepaid in 2010 covering the
years 2010, 2011, and 2012. The prepayment was recorded with a
debit to insurance expense. In addition, on December 31, 2011,
fully depreciated machinery was sold for P9,500 cash, but the sale
was not recorded until 2012. There were no other errors during 2011
or 2012 and no corrections have been made for any of the errors.
Ignore income tax considerations.What is the total net effect of
the errors on Josh's 2011 net income?Net income understated by
P14,500Net income overstated by P13,000Net income overstated by
P7,500Net income overstated by P15,000SOLUTION:P7,500 (o) + P11,000
(o) + P6,000 (o) P9,500 (u) = P15,000 (o)Theory of Accounts - Error
Correction (Easy)Question 42The cost of land typically includes the
purchase price and all of the following costs, exceptStreet light,
sewer and drainage system costAssumption of any lien or mortgage on
the propertyPrivate driveway and parking lotGrading, filling,
draining and clearing costTheory of Accounts - Property, Plant and
Equipment (Average)Question 43Which of the following disclosures
should be made when the fair value model has been adopted for
investment property?Net gain or loss from fair value
adjustmentsUseful life of propertyThe amount of impairment loss
recognizedDepreciation method usedTheory of Accounts - Investment
Property (Average)Question 44If the foreign operation reports in
the currency of a hyperinflationary economy, assets, liabilities
income and expenses shall be translated atAverage rateExchange rate
on the date of transactionForward rateClosing rateTheory of
Accounts - Foreign Currency Transactions and Translations
(Easy)Question 45Which of the following statements is true with
regard to the accountants concept of Materiality?Relevant items are
always materialMateriality judgments are made only by accounting
standard setters, not by managementMateriality judgments generally
may be based solely on the magnitude of the itemMateriality is the
threshold of recognition as to what accountable events will be
recognized in the balance sheet and which will be recognized in the
income statement.Theory of Accounts - Conceptual Framework
(Average)Question 46In an entitys April 30, 2013 statement of
financial position, a note receivable was reported as a noncurrent
asset and its accrued interest for eight months was reported as a
current asset. Which of the following terms would fit the entitys
note receivable?Principal is due August 31, 2013, and interest is
due August 31, 2013 and August 31, 2013Both principal and interest
amounts are payable on August 31, 2013 and August 31, 2013Principal
and interest are due December 31, 2013Both principal and interest
amounts are payable on December 31, 2013 and December 31,
2013Theory of Accounts - Notes Receivable (Average)Question 47Are
each of the following factors relevant, according to PAS 38
Intangible assets, in determining the annual amortization expense
on an intangible asset?Cost method (Not relevant); Amortization
method (Not relevant)Cost method (Relevant); Amortization method
(Relevant)Cost method (Relevant); Amortization method (Not
Relevant)Cost method (Not relevant); Amortization method
(Relevant)Theory of Accounts - Intangible Assets (Average)Question
48An example of an inventory accounting policy that should be
disclosed is theClassification of inventory into raw materials,
work in process and finished goodsIdentification of major
suppliersMethod used for inventory costingEffect of inventory
profit caused by inflationTheory of Accounts - Inventory Valuation
(Average)Question 49Which of the following will not require an
adjusting entry on the depositor's books?Collection from a customer
amounting to P90,000 recorded by depositor as P900,000.Deposit of
another entity credited by the bank to the account of the
depositorLoan proceeds credited to the depositor's accountDAIF
check from a customerTheory of Accounts - Audit of Cash
(Average)Question 50Depending on the business model for managing
financial assets, an entity shall classify financial assets
subsequent to initial recognition atAmortized costEither fair value
or amortized costNeither fair value nor amortized costFair
valueTheory of Accounts - Financial Instruments (Average)Question
51At the end of the fiscal year, Jane Airlines has an outstanding
purchase commitment for the purchase of 1 million gallons of jet
fuel at a price of P4.60 per gallon for delivery during the coming
summer. The company prices its inventory at the lower of cost or
market. If the market price for jet fuel at the end of the year is
P4.25, how would this situation be reflected in the annual
financial statements?Disclose the existence of the purchase
commitmentRecord unrealized losses of P350,000 and disclose the
existence of the purchase commitmentNo impactRecord unrealized
gains of P350,000 and disclose the existence of the purchase
commitmentTheory of Accounts - Inventory Valuation
(Average)Question 52Net realizable value isEstimated selling price
less estimated cost to completeCurrent replacement costEstimated
selling price less estimated cost to complete and estimated cost to
sellEstimated selling priceTheory of Accounts - Inventory Valuation
(Average)Question 53The usual ordering of accounts in the general
ledger isassets, liabilities, owner's capital, drawings, revenues,
and expensesowners capital, assets, liabilities, drawings,
expenses, and revenuesliabilities, assets, owner's capital,
revenues, expenses, and drawingsassets, liabilities, drawings,
owner's capital, expenses, and revenuesTheory of Accounts -
Financial Statements (Easy)Question 54If an entity does not prepare
interim financial reports, thenInterim financial reports should be
included in the year-end FSThe year-end FS compliance with PFRS is
not affectedThe year-end FS will not be acceptable under local
legislationThe year-end financial statements (FS) are deemed not to
comply with PFRSTheory of Accounts - Interim Financial Reporting
(Average)Question 55It is the present value of the cash flows an
entity expects to arise from the continuing use of an asset and
from its disposal at the end of its useful life or expects to incur
when settling a liability.Entity-specific valueValue in useFair
valueDiscounted valueTheory of Accounts - Property, Plant and
Equipment (Average)Question 56One of the accepted methods of
accounting for by-product is to recognize the value of the
by-product as it is produced. Under this method, inventory costs
for the by-product would be based onNeither an allocation of some
portion of joint costs plus any subsequent processing costsAn
allocation of some portion of joint costs plus any subsequent
processing costsNeither an allocation of some portion of joint
costs plus any subsequent processing costsAn allocation of some
portion of joint costs but not any subsequent processing
costsTheory of Accounts - Joint and by-Product Costing
(Difficult)Question 57Adjusting events are those thatAre indicative
of conditions that arose after the end of the reporting
period.Provide for conditions that existed after the date the
financial statements were authorized for issue.Provide evidence of
conditions that existed at the end of the reporting period.Are
favorable or unfavorable and indicative of conditions that arose
after the end of the reporting period.Theory of Accounts - Notes to
Financial Statements (Average)Question 58Which of the following
costs would be capitalized?Salaries of research staffAcquisition
cost of equipment to be used on current research project onlyCost
of research to determine whether a market for the product
exists.Engineering costs incurred to advance the product to the
full production stageTheory of Accounts - R & D Expense
(Average)Question 59The amount of time that is expected to elapse
until an asset is realized or otherwise converted into cash is
referred to asFinancial
flexibilitySolvencyLiquidityExchangeabilityTheory of Accounts -
Statement of Financial Position (Average)Question 60All of the
following are minimum line items for current liabilities,
exceptCurrent provisionsAccounts payableTrade and other
payablesCurrent tax liabilityTheory of Accounts - Statement of
Financial Position (Average)Question 61Use of the
sum-of-the-years'-digits methodresults in salvage value being
ignoredmeans the book value should not be reduced below salvage
valuemeans the denominator is the years remaining at the beginning
of the yearall of theseTheory of Accounts - Depreciation
(Average)Question 62Which of the following adjusting entries cannot
be subject to reversing entriesDeferral of expense under the asset
methodAccrual of expenseAccrual of incomeDeferral of income under
the income methodTheory of Accounts - Financial Statements
(Easy)Question 63Which of the following statements about property
retained earnings is not true?A property dividend is also called a
dividend in kind.The accounting for a property dividend should be
based on the carrying value (book value) of the nonmonetary assets
transferred.A property dividend is usually in the form of
securities of other companies.All of these statements are
true.Theory of Accounts - Retained Earnings (Average)Question
64Under PAS 40, which of the following best describes
owner-occupied property?Property held for capital
appreciationProperty held to earn rentalsProperty held for use in
the production of goods and for administrative purposesProperty
held for sale in the ordinary course of businessTheory of Accounts
- Investments (Average)Question 65If an SME is unable to make a
reliable estimate of the useful life of an intangible asset, the
life is presumed to beTwenty yearsFive yearsTen
yearsIndefiniteTheory of Accounts - SME (Easy)Question 66Santiago
Corporation signs an agreement to lease land a building for 20
years. At the end of the lease, the property will not transfer to
Santiago. The life of the building is estimated to be 20 years.
Santiago prepares its financial statement in accordance with PFRS.
How should Santiago account for the lease?The lease is recorded as
a finance lease and the building is recorded as an operating
leaseThe lease is recorded as a finance leaseThe lease is recorded
as an operating lease and the building is recorded as a finance
leaseThe lease is recorded as an operating leaseTheory of Accounts
- Finance Lease - Lessee (Average)Question 67The fair value
optionReports all gains and losses in incomeMay be selected as a
valuation method by the entity at any time during the first two
years of ownershipMust be applied to all instruments the entity
holdsAll of the choices are correct.Theory of Accounts - Financial
Asset at Fair Value (Average)Question 68Ignoring tax effects,
accelerated depreciation methodsIncrease funds provided by
operationsTend to offset steadily increasing repair and maintenance
costsProvide funds for the earlier replacement of fixed assetsTend
to decrease the fixed assets turnover ratioTheory of Accounts -
Depreciation (Average)Question 69The basic accounting issue for a
lessor isRevenue recognition during the lease termComputing
depreciation over the lease termExpense recognition during the
lease termDetermination of the cost of the leased assetTheory of
Accounts - Direct Financing Lease - Lessor (Easy)Question 70At the
commencement of the lease, the lessee shall recognize a finance
lease as asset and liability at an amount equal to thePresent value
of the minimum lease paymentsFair value at the leased assetFair
value of the leased asset or present value of the minimum lease
payments, whichever is higherFair value of the leased asset or
present value of the minimum lease payments, whichever is
lowerTheory of Accounts - Finance Lease - Lessee (Easy)Question
71Gomez Company received P7,200 on April 1, 2014 for one year's
rent in advance and recorded the transaction with a credit to a
nominal account. The December 31, 2014 adjusting entry isdebit
Unearned Rent and credit Rent Revenue, P1,800debit Unearned Rent
and credit Rent Revenue, P5,400debit Rent Revenue and credit
Unearned Rent, P5,400debit Rent Revenue and credit Unearned Rent,
P1,800Theory of Accounts - Financial Statements (Average)Question
72An entity owns 2% of another entity. A property dividend
distributed by the other entity consisted of merchandise with a
fair value lower than the listed retail price. The entity in turn
gave the merchandise to its employees as a holiday bonus. Hoe
should the entity report the receipt and distribution of the
merchandise in its statement of cash flows?As an inflow for
investing activities and outflow for operating activitiesAs both an
inflow and outflow for operating activitiesAs both an inflow and
outflow for investing activitiesAs a noncash activityTheory of
Accounts - Statement of Cash Flows (Average)Question 73Under PAS
33, contingent ordinary shares are treated as outstanding and
included in the computation of both basic and diluted earnings per
share if the conditions are satisfied. Which of the following
statements is true?IContingent ordinary shares are included in the
calculation of basic earnings per share from the date the condition
is satisfied
IIContingent ordinary shares are included in the calculation of
diluted earnings per share from the beginning of the period or from
the date of contingent agreement, lf later
I onlyNeither I nor IIII onlyBoth I and IITheory of Accounts -
Diluted Earnings Per Share (Average)Question 74Factory overhead
includesAll manufacturing costsAll manufacturing costs which may be
variable or fixed, except direct materials and direct laborIndirect
labor but not indirect materialsIndirect materials but not indirect
laborTheory of Accounts - Cost Concepts (Easy)Question 75How would
you describe fixed cost?It is constant per unit of change in
productionIt may change in total where such change depends on
production within the relevant range.It may change in total where
such change is unrelated to changes in productionIt may change in
total where such change is related to changes in production.Theory
of Accounts - Cost Concepts (Average)Question 76To value a stock
initially going public, which of the following processes would not
be an effective pricing tool?liquidity value approachIPO
approachcalculate NPV of cash flowsbook value approachTheory of
Accounts - Shareholders' Equity (Average)Question 77A pension asset
is reported whenthe accumulated benefit obligation exceeds the fair
value of pension plan assetsthe accumulated benefit obligation
exceeds the fair value of pension plan assets, but a prior service
cost existspension plan assets at fair value exceed the accumulated
benefit obligationpension plan assets at fair value exceed the
projected benefit obligationTheory of Accounts - Retirement
Benefits (Average)Question 78A statement of cash flows typically
would not disclose the effects ofcapital stock issued at an amount
greater than par valuestock dividends declareda purchase and
immediate retirement of treasury stockcash dividends paidTheory of
Accounts - Statement of Cash Flows (Average)Question 79A debit
balance in the allowance for doubtful accountsShould never occurMay
occur before year-end adjustment for uncollectiblesIs always the
result of management not providing a large enough allowance in
order to manage earningsMay exist even after year-end adjustment of
uncollectiblesTheory of Accounts - Accounts Receivable
(Average)Question 80Under the allowance method, the entries at the
time of collection of an account previously written off
wouldDecrease the allowance for doubtful accountsHave no effect on
the allowance for doubtful accountsHave no effect on net
incomeIncrease net incomeTheory of Accounts - Accounts Receivable
(Average)Question 81To compute the price to pay for a bond, what
present value concept is used?Neither the present value of 1
concept 'nor the present value of annuity of 1 conceptBoth the
present value of I concept and present value of an annuity of 1
conceptOnly the present value Of 1 conceptOnly the present value of
an annuity of 1 conceptTheory of Accounts - Bonds Payable
(Average)Question 82The warrants time value is equal to(market
price - exercise value)/number of sharesmarket price/exercise
valuethe market price of the warrant minus its exercise
valueexercise value/market priceTheory of Accounts - Shareholders'
Equity (Average)Question 83Significant change in the market value
of trading securities occurring after the balance sheet date
shouldBe treated as a prior period error in next years financial
statementsResult in an adjustment of the market value used in the
lower of cost or market valuation at balance sheet dateNot be
considered in the valuation of the securities at the balance sheet
date but disclosed in the notes to the financial statementsBe
considered in the valuation of securities at balance sheet date and
disclosed in the notes to the financial statementsTheory of
Accounts - Financial Asset at Fair Value (Difficult)Question 84All
of the following can be classified as cash and cash equivalents,
exceptBank overdraftEquity investmentsRedeemable preference shares
acquired and due in 60 daysLoan notes held due for repayment in 90
daysTheory of Accounts - Cash and Cash Equivalents (Easy)Question
85Which of the following is a correct statement of one of the
capitalization criteria?The lease contains a purchase optionThe
minimum lease payments (excluding executory costs) equal or exceed
90% of the fair value of the leased propertyThe lease term is equal
to or more than 75% of the estimated economic life of the leased
propertyThe lease transfers ownership of the property to the
lessorTheory of Accounts - Finance Lease - Lessee (Average)Question
86On the basis of the Conceptual Framework, revenues + gains
=IncomeNo meaningful amountCash receiptsSales and earned feesTheory
of Accounts - Conceptual Framework (Average)Question 87All
appropriations, revenue or tariff bills, bills authorizing increase
of the public debt, bills of local application and private bills
shall originate exclusively in theHouse of RepresentativesHouse of
Representatives but the Senate may propose or concur with
amendments.SenateSenate but the House of Representatives may
propose or concur with amendments.Theory of Accounts - Government
Accounting (Average)Question 88An entity issue rights to its
existing shareholders to purchase unissued ordinary shares at more
than par value. Share premium would be recorded when the rightsAre
not exercisedAre issuedAre exercisableAre exercisedTheory of
Accounts - Shareholders' Equity (Average)Question 89Under PFRS 2,
if the fair value of the share options cannot be estimated
reliably, then share options are measured based onTheoretical
parity valueAppraised ValueIntrinsic ValuePar ValueTheory of
Accounts - Share Options (Easy)Question 90The primary purpose of a
quasi-reorganization is to give the entity the opportunity
toEliminate a deficit in retained earningsDistribute the shares of
a newly created subsidiary to its stockholders in exchange for part
of their shares in the corporationObtain relief from its
creditorsRevalue understated assets to their fair valueTheory of
Accounts - Quasi Reorganization (Average)Question 91When an
investor's accounting period ends on a date that does not coincide
with an interest receipt date for bonds held as an investment, the
investor mustnotify the issuer and request that a special payment
be made for the appropriate portion of the interest period.do
nothing special and ignore the fact that the accounting period does
not coincide with the bond's interest period.make an adjusting
entry to debit Interest Receivable and to credit Interest Revenue
for the amount of interest accrued since the last interest receipt
date.make an adjusting entry to debit Interest Receivable and to
credit Interest Revenue for the total amount of interest to be
received at the next interest receipt date.Theory of Accounts -
Investments (Difficult)Question 92Budget accountability consists
ofIPeriodic reporting by the agencies of performance under the
approved budget
IITop management review of government activities and the fiscal
and policy implications thereof.
IIIThe actions of COA in assuring fidelity of officials and
employees by carrying out the intent of Congress in regard to their
handling of receipts and expenditures.
I onlyI, II and IIII and II onlyI and III onlyTheory of Accounts
- Government Accounting (Difficult)Question 93Which of the
following is not a category of financial assets defined in PAS
39?Available-for-sale financial assetsFinancial assets at fair
value through profit or lossLoans and receivablesHeld-for-sale
financial assetsTheory of Accounts - Financial Asset at Fair Value
(Easy)Question 94General income accounts encompassIAll types of
revenue or income generated by agencies in the exercise of their
administrative and regulatory function, income from public
enterprises or investments, and income from grants and
donations.
IIAll taxes imposed on income, properties and use or sale of
goods and services, taxes on international trade and transactions,
and other taxes including fines and penalties.
I onlyII onlyNeither I nor IIBoth I and IITheory of Accounts -
Government Accounting (Difficult)Question 95Which of the following
tables would show the smallest factor for an interest rate of 10%
for six periods?Future value of an annuity due of 1Present value of
an annuity due of 1Future value of an ordinary annuity of 1Present
value of an ordinary annuity of 1Theory of Accounts - Time Value of
Money (Easy)Question 96The term "depreciable base," or
"depreciation base," as it is used in accounting, refers tothe
acquisition cost of the assetthe total amount to be charged
(debited) to expense over an asset's useful lifethe estimated
market value of the asset at the end of its useful lifethe cost of
the asset less the related depreciation recorded to dateTheory of
Accounts - Depreciation (Average)Question 97How should a gain from
sale of used equipment for cash be reported in a cash flow
statement using the indirect method?In investing activities as an
addition to incomeIn investing activities as a deduction from
incomeIn investing activities as a cash outflowIn investing
activities as a reduction of the cash inflow from the saleTheory of
Accounts - Statement of Cash Flows (Easy)Question 98The contractual
adjustment account of a nonprofit hospital is a(an)Asset
accountContra-revenue accountLoss accountExpense accountTheory of
Accounts - Not for Profit Organizations (Average)