This quiz works best with JavaScript enabled. Home > Accounting > Financial Reporting > Financial Reporting – Quiz 8 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Reporting Quiz 8 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Recognition is the process of: A) Determining where an item should be presented in the financial statements. B) Incorporating an item in the financial statements. C) Disclosing information in the notes to the financial statements. D) Determining the amount at which an item should be shown in the financial statements. Show Answer Correct Answer: B) Incorporating an item in the financial statements. 2. When is Impairement Reserve created: A) When ECL > IRAC provision. B) When ECL < IRAC provision. C) None of the Above. D) None of above. Show Answer Correct Answer: B) When ECL < IRAC provision. 3. If an entity adopts PFRS for the first time in the current year, its first PFRS financial statements include the following: A) Two statement of comprehensive income. B) Two statement of financial position. C) Three statement of cash flows. D) None of the above. Show Answer Correct Answer: A) Two statement of comprehensive income. 4. Decision makers vary widely in the types of decisions they make, the methods of decision making they employ, the information they already possess or can obtain from other sources, and their ability to process information. Consequently, for information to be useful there must be a linkage between these users and the decisions they make. This link is A) Relevance. B) Reliability. C) Understandability. D) Materiality. Show Answer Correct Answer: C) Understandability. 5. Relevant information is: A) That information tells investors about the company's future economic prospects. B) Reliability i.e. the usefulness of decisions on fair value based Financial Statements is compromised if too much reliability is sacrificed for greater relevance. C) Management skepticism regarding RRA (Reserve Accounting), if there are unrealized profits & losses from changes in fair value contained in net PROFIT,. D) Management cannot possibly manipulate financial reports. E) All answers are correct. Show Answer Correct Answer: A) That information tells investors about the company's future economic prospects. 6. Which of the following statements about the primary purpose of financial reporting is the most correct? A) Provides information that can help with decision-making. B) The individual needs of users can be satisfied by tailoring of financial reports. C) Enables accountability since managers would have to account for resources used. D) Identifies a range of existing and potential users dependant on financial statements to make decisions. Show Answer Correct Answer: A) Provides information that can help with decision-making. 7. Purple Fleur S.A., a retailer of floral products, reported cost of goods sold for the year of $ 75 million. Total assets increased by $ 55 million, but inventory declined by $ 6 million. Total liabilities increased by $ 45 million, and accounts payable increased by $ 2 million. The cash paid by the company to its suppliers is most likely closest to: A) $ 67 million. B) $ 79 million. C) $ 83 million. D) None of above. Show Answer Correct Answer: A) $ 67 million. 8. Which of the following statements is most accurate? A) As it general rule, it is sufficient for an Analyst covering an industry to be familiar with Financial standards and regulations in his/her country of residence. B) An analyst should familiarize him/herself with the regulations and reporting standards that affect the company and/or industry that he/she analyzing. C) An analyst should be aware that Financial reporting standards vary among countries and may be industry specific tut standards are so simile that Analyst does not have to be concerned about it. D) None of above. Show Answer Correct Answer: B) An analyst should familiarize him/herself with the regulations and reporting standards that affect the company and/or industry that he/she analyzing. 9. A very large business has a small amount of stationery in hand at the end of the financial year. It does not make an effort to record it. Which of the following concepts is being applied? A) Accounting entity. B) Going concern. C) Monetary. D) Materiality. Show Answer Correct Answer: D) Materiality. 10. Which of the following is not the enhancing qualitative characteristics of financial information? A) Comparability. B) Relevance. C) Verifiability. D) Timeliness. Show Answer Correct Answer: B) Relevance. 11. In what principle states that one must base accounting records and statements on the most accurate data available? A) Cost. B) Matching. C) Consistency. D) Reliability. Show Answer Correct Answer: D) Reliability. 12. The source of data for preparing closing entries is the: A) Trial balance. B) Worksheet. C) Worksheet plus general journal. D) All of the above are possible. Show Answer Correct Answer: B) Worksheet. 13. What is the Return on Investments for 9M 2022 on Total 9M 2021?ROI=(Net Return on Investment/Cost of Investment)*100%*Time effectAnnualization1st Q (12/3 =4) 2nd Q (12/6=2) 3rd Q (12/9=1, 3333) 4th Q (12/12=1) A) 1, 7%. B) 1, 3%. C) 3%. D) 1, 6%. Show Answer Correct Answer: C) 3%. 14. Which of the following stakeholders relies on financial reports to make investment decisions? A) Competitors. B) Customers. C) Suppliers. D) Shareholders. Show Answer Correct Answer: D) Shareholders. 15. Under PAS 34, interim financial reports should be published A) Once a year at any time in that year. B) Within a month of the half year end. C) On a quarterly basis. D) Whenever the entity wishes. Show Answer Correct Answer: D) Whenever the entity wishes. 16. What is the Return on Investments for 9M 2022 on Corporate Solutions?ROI=(Net Return on Investment/Cost of Investment)*100%*Time effectAnnualization1st Q (12/3 =4) 2nd Q (12/6=2) 3rd Q (12/9=1, 3333) 4th Q (12/12=1) A) 1, 4%. B) 1, 3%. C) 3%. D) 1, 9%. Show Answer Correct Answer: B) 1, 3%. 17. Qualitative characteristic that financial information must possess to be useful to the primary users of general purpose financial reports include A) Timeliness. B) Verifiability. C) Understandability. D) Faithful representation. Show Answer Correct Answer: D) Faithful representation. 18. Who shall mandatorily appoint Independent Directors? A) Listed Public Company. B) Public Company having:PUC $\geq$ Rs. 10 Cr.; or Turnover $\geq$ Rs. 100 Cr.; or Outstanding Loans, Debentures & Deposits $\geq$ Rs. 50 Cr. C) (a) and (b). D) None of the above. Show Answer Correct Answer: C) (a) and (b). 19. Income statement or Profit and Loss account = Inflow minus Outflow. A) TRUE. B) FALSE. Show Answer Correct Answer: A) TRUE. 20. Which of the following is a category, classification, or element of the balance sheet? A) Expenses. B) Liabilities. C) Gains. D) Losses. Show Answer Correct Answer: B) Liabilities. ← PreviousNext →Related QuizzesAccounting QuizzesFinancial Reporting Quiz 1Financial Reporting Quiz 2Financial Reporting Quiz 3Financial Reporting Quiz 4Financial Reporting Quiz 5Financial Reporting Quiz 6Financial Reporting Quiz 7Financial Reporting Quiz 9Financial Reporting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books