This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Reporting > Financial Reporting – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Reporting Quiz 5 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The purpose of comprehensive income reporting is..... A) To report changes in equity based on transactions with owners. B) To report overall company performance. C) To link net profit (net income) to be better. D) Untuk menggabungkan income from continuingoperations dengan income from discontinued operationsdan extraordinary items. Show Answer Correct Answer: B) To report overall company performance. 2. Which basic assumption may not be followed when a firm in bankruptcy reports financial results? A) Monetary unit assumption. B) Economic entity assumption. C) Periodicity assumption. D) Going concern assumption. Show Answer Correct Answer: D) Going concern assumption. 3. Cash or other items that can be converted to cash fairly quickly and are used by the business within a year ex:cash, supplies, merchandise, accounts receivable A) Fixed Assets. B) Current Assets. C) Assets. D) Accounts Receivable. Show Answer Correct Answer: B) Current Assets. 4. Harmonization Efforts from IOSCO A) Works to achieve improved market regulation internationally. B) Works to facilitate cross-border listings. C) Advocates for the development and adoption of a single-set of high quality accounting standards. D) A, B, C True. Show Answer Correct Answer: D) A, B, C True. 5. A business compiling its financial statements for the year to 31 January each year pays rent quarterly in advance on 1 January, 1 April, 1 July and 1 October each year. After remaining unchanged for some years, the rent was increased from $ 24, 000 per year to $ 30, 000 per year as from 1 July 20X0. Which of the following figures in the rent expense which should appear in the statements of profit or less for year ended 31January 20X1? A) $ 27, 500. B) $ 29, 000. C) $ 28, 000. D) $ 29, 500. Show Answer Correct Answer: A) $ 27, 500. 6. Charlie started a small business and he is trying to understand his financials. He wants to know which financial statement provides information about his company's sources of financing and how he is using the money. Can Lily or Emily help him? A) Statement of Financial Position. B) Balance Sheet. C) Cash Flow Statement. D) Statement of Income. Show Answer Correct Answer: A) Statement of Financial Position. 7. Under PFRS for Small Entities, Inventories are subsequently measured using A) Cost. B) Lower of Cost or Market Value. C) Lower of Cost or Cost of Estimated Selling Price less cost to complete and Sell. D) Lower of Cost or Net Realizable Value. Show Answer Correct Answer: B) Lower of Cost or Market Value. 8. Defining total asset turnover as revenue divided by average total assets, all elseequal, impairment write-downs of long-lived assets owned by a company will most likely result in an increase for that company in: A) The debt-to-equity ratio but not the total asset turnover. B) The total asset turnover but not the debt-to-equityratio. C) Both the debt-to-equityratio and the total asset turnover. D) None of above. Show Answer Correct Answer: C) Both the debt-to-equityratio and the total asset turnover. 9. The going concern concept is A) Reporting numbers without calculating inflation. B) Reporting accounting info at regular intervals. C) Not overstating assets owner's equity, and revenues and not understating abilities and expenses. D) Assuming that a business will continue to operate for the foreseeable future. Show Answer Correct Answer: D) Assuming that a business will continue to operate for the foreseeable future. 10. One of the notable differences between PFRS for SMEs and PFRS for Small Entities is that PFRS for SMEs includes Other Comprehensive Income while PFRS for Small Entities does not have other comprehensive incomes. A) True. B) False. Show Answer Correct Answer: A) True. 11. White Flag, a women's clothing manufacturer, reported salaries expense of $ 20 million. The beginning balance of salaries payable was $ 3 million, and the ending balance of salaries payable was $ 1 million. How much cash did the company pay in salaries? A) $ 18 million. B) $ 21 million. C) $ 22 million. D) None of above. Show Answer Correct Answer: C) $ 22 million. 12. What Financial Statement Assertion is not covered by FR-01 and FR-02? A) Accuracy. B) Validity. C) Restricted Access. D) Completeness. Show Answer Correct Answer: C) Restricted Access. 13. In preparing a new standard, after preparing the initial draft of a new standard, the stages carried out by the standards council in Indonesia are..... A) Conduct public hearings. B) Discussion within the standards council. C) Launch exposure draft. D) Draft approval becomes the new standard. Show Answer Correct Answer: B) Discussion within the standards council. 14. Which of the following is not other comprehensive income?..... A) Profit/Loss from discontinued operations. B) Gains and losses on increases in asset value are presented using fair value. C) Profit/loss from foreign currency translation. D) Profit/loss from effective cash flow hedging. Show Answer Correct Answer: A) Profit/Loss from discontinued operations. 15. It shows the financial condition of the entity as at a certain date A) Statement of Financial Condition. B) Statement of Financial Position. C) Statement of Financial Disposition. D) None of above. Show Answer Correct Answer: B) Statement of Financial Position. 16. Recording assets and services, revenues, and expenses at their actual historical cost falls under which principle? A) Consistency. B) Cost. C) Matching. D) Reliability. Show Answer Correct Answer: B) Cost. 17. Foreign companies listed on an exchange in Malaysia are now given a choice of using either MASB Standards or internationally recognised accounting standards in their entirety for the preparation of financial statements. The accounting standards issued by the following bodies are acceptable accounting standards for this purpose except: A) International Accounting Standards Board. B) Financial Accounting Standards Board, USA. C) United Arab Emirates Accounting Standards. D) Australian accounting Standards Board, Australia. Show Answer Correct Answer: C) United Arab Emirates Accounting Standards. 18. Users of accounting information who want accounting information that makes it possible to provide loans are: A) Businessman. B) Creditor. C) Government. D) Persero. E) Manager. Show Answer Correct Answer: A) Businessman. 19. Which of the following best describes the role of financial statement analysis? A) To provide information about a company's performance. B) To provide information about a company's changes in financial position. C) To form expectations about a company's future performance and financial position. D) None of above. Show Answer Correct Answer: C) To form expectations about a company's future performance and financial position. 20. Which is not a category of Company Fixed Assets? A) Grafity Roller. B) X-Ray. C) Pallet. D) Blind Van. Show Answer Correct Answer: C) Pallet. 21. Recognition is the process of: A) Incorporating an item in the financial statements. B) Determining where an item should be presented 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: A) Incorporating an item in the financial statements. 22. 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. 23. 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. 24. 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. 25. 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. 26. 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. 27. 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. 28. 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) Monetary. B) Materiality. C) Accounting entity. D) Going concern. Show Answer Correct Answer: B) Materiality. 29. Which of the following is not the enhancing qualitative characteristics of financial information? A) Verifiability. B) Relevance. C) Timeliness. D) Comparability. Show Answer Correct Answer: B) Relevance. 30. In what principle states that one must base accounting records and statements on the most accurate data available? A) Cost. B) Reliability. C) Matching. D) Consistency. Show Answer Correct Answer: B) Reliability. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesFinancial Reporting Quiz 1Financial Reporting Quiz 2Financial Reporting Quiz 3Financial Reporting Quiz 4Financial Reporting Quiz 6Financial Reporting Quiz 7Financial Reporting Quiz 8Financial Reporting Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books