Question 1

In a statement of cash flows, proceeds from issuing equity instruments should be classified as cash inflows from

Accepted Answer

A)  lending activities.
B)  operating activities.
C)  investing activities.
D)  financing activities.E) C) and D)
F) B) and C)

Question 2

Which of the following is a current asset?

Accepted Answer

A)  Cash surrender value of a life insurance policy of which the company is the bene-ficiary.
B)  Investment in equity securities for the purpose of controlling the issuing company.
C)  Cash designated for the purchase of tangible fixed assets.
D)  Trade installment receivables normally collectible in 18 months.E) A) and B)
F) B) and D)

Question 3

Under IFRS, companies may offset assets and liabilities; for example, accounts payable may be offset against cash to report net cash available for other expenses.

Accepted Answer

A) True 
 B)False

Question 4

Pedigo Corporation reports the following information:  Pedigo's cash debt coverage is

Accepted Answer

A)  0.90.
B)  1.50.
C)  2.25.
D)  4.09.E) B) and C)
F) C) and D)

Question 5

Which of the following is not an acceptable major asset classification?

Accepted Answer

A)  Current assets
B)  Investments
C)  Property, plant, and equipment
D)  Deferred chargesE) C) and D)
F) A) and C)

Question 6

The shareholders' equity section is usually divided into how many parts?

Accepted Answer

A)  6
B)  5
C)  4
D)  3E) A) and B)
F) B) and C)

Question 7

Which of the following is a limitation of the statement of financial position?

Accepted Answer

A)  Many items that are of financial value are omitted.
B)  Judgments and estimates are used.
C)  Current fair value is not reported.
D)  All of these choices are correct.E) C) and D)
F) B) and D)

Question 8

Which of the following statements is incorrect regarding notes to the financial statements?

Accepted Answer

A)  IFRS requires specific note disclosures including disaggregation of inventories into classifications such as merchandise, production supplies, work in process, and finished goods.
B)  IFRS requires a maturity analysis for receivables.
C)  IFRS requires that all notes be clear, simple to understand, and non-technical in nature.
D)  All of the choices are correct regarding notes to the financial statements.E) A) and C)
F) A) and B)

Question 9

Under IFRS a company may use the term "reserve" to include items such as retained earnings, share premium, and accumulated other comprehensive income.

Accepted Answer

A) True 
 B)False

Question 10

For Randolph Company, the following information is available:  In Randolph's statement of financial position, intangible assets should be reported at

Accepted Answer

A)  R110,000.
B)  R105,000.
C)  R390,000.
D)  R385,000.E) None of the above
F) C) and D)

Question 11

Presented below are data for Bandkok Corp.  Equity at January 1, 2015 is

Accepted Answer

A)  Rp1,690.
B)  Rp1,798.
C)  Rp2,932.
D)  Rp2,986.E) A) and D)
F) B) and D)

Question 12

A complete set of financial statements includes each of the following except

Accepted Answer

A)  a statement of comprehensive income.
B)  a statement of changes in equity.
C)  notes.
D)  All of these answers are included.E) A) and B)
F) A) and D)

Question 13

The statement of cash flows reports all of the following except

Accepted Answer

A)  the net change in cash for the period.
B)  the cash effects of operations during the period.
C)  the free cash flows generated during the period.
D)  investing transactions.E) None of the above
F) A) and D)

Question 14

Free cash flow is calculated as net cash provided by operating activities less

Accepted Answer

A)  capital expenditures.
B)  dividends.
C)  capital expenditures and dividends.
D)  capital expenditures and depreciation.E) All of the above
F) B) and D)

Question 15

The statement of cash flows provides answers to all of the following questions except

Accepted Answer

A)  where did the cash come from during the period?
B)  what was the cash used for during the period?
C)  what is the impact of inflation on the cash balance at the end of the year?
D)  what was the change in the cash balance during the period?E) All of the above
F) A) and C)

Question 16

An asset which is expected to be converted into cash, sold, or consumed within one year of the statement date is always reported as a current asset.

Accepted Answer

A) True 
 B)False

Question 17

Free cash flow is net income less capital expenditures and dividends.

Accepted Answer

A) True 
 B)False

Question 18

Significant financing and investing activities that do not affect cash are not reported in the statement of cash flows or any other place.

Accepted Answer

A) True 
 B)False

Question 19

For Grimmett Company, the following information is available:  In Grimmett's statement of financial position, intangible assets should be reported at

Accepted Answer

A)  ¥ 55,000.
B)  ¥ 75,000.
C)  ¥255,000.
D)  ¥275,000.E) A) and B)
F) A) and C)

Question 20

Harding Corporation reports the following information:  Harding should report cash provided by operating activities of

Accepted Answer

A)  R$600,000.
B)  R$840,000.
C)  R$1,160,000.
D)  R$1,400,000.E) None of the above
F) All of the above

Exam 5: Statement of Financial Position and Statement of Cash Flows

Under IFRS a company may use the term "reserve" to include items such as retained earnings, share premium, and accumulated other comprehensive income.

Correct AnswerverifiedShow Answer

Which of the following is not an acceptable major asset classification?

Correct AnswerverifiedShow Answer

In a statement of cash flows, proceeds from issuing equity instruments should be classified as cash inflows from

Correct AnswerverifiedShow Answer

The shareholders' equity section is usually divided into how many parts?

Correct AnswerverifiedShow Answer

Free cash flow is calculated as net cash provided by operating activities less

Correct AnswerverifiedShow Answer

Which of the following is a limitation of the statement of financial position?

Correct AnswerverifiedShow Answer

The statement of cash flows reports all of the following except

Correct AnswerverifiedShow Answer

The statement of cash flows provides answers to all of the following questions except

Correct AnswerverifiedShow Answer

Harding Corporation reports the following information: Harding should report cash provided by operating activities of

Correct AnswerverifiedShow Answer

Pedigo Corporation reports the following information: Pedigo's cash debt coverage is

Correct AnswerverifiedShow Answer

Free cash flow is net income less capital expenditures and dividends.

Correct AnswerverifiedShow Answer

Significant financing and investing activities that do not affect cash are not reported in the statement of cash flows or any other place.

Correct AnswerverifiedShow Answer

Which of the following is a current asset?

Correct AnswerverifiedShow Answer

A complete set of financial statements includes each of the following except

Correct AnswerverifiedShow Answer

For Grimmett Company, the following information is available: In Grimmett's statement of financial position, intangible assets should be reported at

Correct AnswerverifiedShow Answer

Presented below are data for Bandkok Corp. Equity at January 1, 2015 is

Correct AnswerverifiedShow Answer

An asset which is expected to be converted into cash, sold, or consumed within one year of the statement date is always reported as a current asset.

Correct AnswerverifiedShow Answer

Under IFRS, companies may offset assets and liabilities; for example, accounts payable may be offset against cash to report net cash available for other expenses.

Correct AnswerverifiedShow Answer

Which of the following statements is incorrect regarding notes to the financial statements?

Correct AnswerverifiedShow Answer

For Randolph Company, the following information is available: In Randolph's statement of financial position, intangible assets should be reported at

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified