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Ia Midterm Exam

1. The presentation of notes to financial statements and disclosure of accounting policies and estimates are mandatory. 2. Errors such as failing to accrue expenses or incorrectly recording adjustments can result in financial statements being overstated or understated. 3. Classification of transactions and disclosure of related party relationships are required to comply with accounting standards.

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0% found this document useful (0 votes)
178 views2 pages

Ia Midterm Exam

1. The presentation of notes to financial statements and disclosure of accounting policies and estimates are mandatory. 2. Errors such as failing to accrue expenses or incorrectly recording adjustments can result in financial statements being overstated or understated. 3. Classification of transactions and disclosure of related party relationships are required to comply with accounting standards.

Uploaded by

Resty Villaroel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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1.

The presentation of the notes to financial statements in a systematic manner – is mandatory, as


far as practicable
2. The amortization of bond discount related to – addition to net income
3. The standard of adequate disclosure – all information related to the business
4. Which of the following as a counterbalancing error – prepaid expense adjusted incorrectly
5. All of the following could potentially be classified – dividends paid
6. The overstatement of ending inventory in the current year – statement of financial position
7. Events that occur after the current year end but before financial - used to record an
adjustments
8. At the middle of the year, an entity paid for insurance premium – overstates owner’s equity
9. Kamala company - 240,000 overstated
10. An overstatement of ending inventory in the current period – understated
11. Rolly company – 11,000 understated
12. If inventory is overstated at the beginning of the year – overstate cost of goods available for
sale
13. Which of the following statements is true – notes to the financial statements would give details
of material non-adjusting events
14. Under pfrs, interest paid – operating or financing
15. Events after the reporting period are favorable – the end of the reporting period on the date
16. Biden company – understated by 60,000
17. An entity shall disclose in the summary of significant – the measurement basis and the
accounting policies used
18. At the end of the current year, an entity failed to accrue sales commissions – overstated and
overstated
19. Which of the following is not required as a separate related party dislosure – an entity that has
a common director with the entity
20. Net cash used in financing activities – 7,150,000
21. Which of the following is not a mandated disclosure – names of all the associates that an entity
22. Which of the following errors would result in an overstatement – holiday pay expenses
23. If at the end of the reporting period, an entity erroneously excluded some goods – no effect on
net income
24. Effect of the errors on net income – 16,000 understated
25. A cash dividend that is declared during – a non-cash transcation presented
26. Disclosures of related party transaction include all excepts – sales of inventory by a subsidiary
to the parent ?
27. All of the following can be classified as cash and cash equivalents except – Equity investment ?
28. The current year end physical inventory appropriately – no effect, understate, understate
29. Which of the following would cost income of the current period – understating estimate
residual value
30. Errors on working capital – 6,000 overstated
31. Failure to record accrued salaries – overstated retained earnings
32. Under pfrs, dividends paid – operating or financing
33. Disclosure of information about judgments - is mandatory
34. At the end of the curent year, special insurane cost – understated and no effect
35. Non-adjusting events include all except – destruction of a major production plant by fire ?
36. Which of the following, if discovered in the accounting period subsequent - capitalization of an
expense
37. Disclosure of information about key sources of estimation – is mandatory
38. Which of the following is not a required minimum disclosure – the amount of similar
transaction with an related parties
39. Investing activities include – cash payments for future contract
40. When the current year’s ending inventory is overstated - the current year’s net income is
overstated

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