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Nfjpia Mockboard 2011 Toa
Nfjpia Mockboard 2011 Toa
In partnership with the Professional Review & Training Center, Inc. and Isla Lipana & Co.
THEORY OF ACCOUNT
S
INSTRUCTIONS: Select the best answer for each of the following questions. Mark
only one answer for each item on the answer sheet provided. AVOID ERASURES.
Answers with erasures may render your examination answer sheet INVALID. Use
PENCIL NO.2 only. GOODLUCK!
61. When computing basic earnings per share on 67. Which statement is incorrect regarding events after
ordinary shares, dividends on cumulative, balance sheet date?
nonconvertible preference shares should be a. Events after the balance sheet date that
a. deducted from net income only if the dividends provide further evidence of conditions that
were declared or paid in the current period. existed at the balance sheet date will
b. deducted from net income regardless of require adjustments to the financial
whether the dividends were not paid or declared statements.
in the period. b. Events or conditions that arose after the
c. deducted from net income only if net income balance sheet date does not require
is greater than the dividends. adjustments to the financial statements.
d. ignored. c. If an entity declares dividends after the
balance sheet date, the entity shall recognize
62. Which statement is incorrect regarding cash flow those dividends as a liability at the
statements? balance sheet date.
a. All enterprises that prepare financial d. An entity shall not prepare its financial
statements in conformitywith GAAP are statements on a going concern basis
required to present a cash flow statement. if management determines after the
b. Cash flows must be analyzed between balance sheet date either that it intends to
operating, investing and financing activities. liquidate the entity or to cease trading, or
c. The cash flow statement analyses changes in that it has no realistic alternative but to do
cash and cash equivalents during a period. so.
d. For operating cash flows, the indirect method
of presentation is encouraged, but the direct 68. Unrelated parties include all of the following,
method is acceptable. except
a. Providers of finance
63. PAS 7 Cash Flow Statements, requires that b. Two venturers simply because they share joint
investing and financing transactions that do not require control over the joint venture
the use of cash or cash equivalents should be: c. Single customer with whom the entity transacts
a. excluded from a cash flow statement; significant volume of business merely by virtue of the
b. included in a cash flow statement before resulting economic dependence
operating, investing and financing activities; d. Key management personnel and close family
c. presented in the cash flow statement after members of such individual
operating activities and before investing and
financing activities; 69. The minimum disclosures prescribed under PAS
d. presented in a cash flow statement after 24 are to be made separately for certain categories of
the operating, investing and financing activities related parties. Which of the following is not among
have been presented. the list of categories specified under the Standard
for the purposes of separate disclosure?
64. Which of the following information should be a. Entities with joint control or significant influence
included in Melay, Inc.’s 2010 summary of over the entity
significant account policies? b. The parent company of the entity
a. Property, plant and equipment is recorded c. An entity that has a common director with the
at cost with depreciation computed entity
principally by the straight-line method. d. Joint ventures in which the entity is a venturer
b. During 2010, the Delay Segment was sold.
c. Business segment 2010 sales are Alay P1 70. Under PFRS 8 Operating Segments, separate
M, Belay P2M, and Celay P3M. segments of an entity must be identified as
d. Future common shares dividends are reportable segments until at least:
expected to approximate 60% of earnings. a. 100% of total entity result is included;
b. 80% of total entity liabilities are included;
65. The management of an entity completes draft of c. 75% of total entity revenue is included;
financial statements for the year ended December 31, d. 70% of total entity assets are included.
2008 on February 28, 2009. On March 15, 2009, the
board of directors reviews the financial statements 71. Interim period is a financial reporting period
and authorizes them for issue. The entity a. equal to six months
announces its profit and selected other financial b. shorter than one year
information on March c. longer than one year
20, 2009. The financial statements are made available d. equal to three months
to shareholders and others on April 1, 2006. The
shareholders approved the financial statements at their 72. Financial liabilities include
annual meeting on May 10, 2009 and the approved a. Bank overdraft.
financial statements are then filed with SEC and BIR on b. Loans receivable.
May 30, 2009. For purposes of identifying events after c. Income tax payable.
balance sheet date, the financial statements d. Cumulative, redeemable preference shares
were authorized for issue on at the option of the issuer
a. March 15, 2009 c. March 20, 2009
b. May 10, 2009 d. May 30, 2009 73. The following transfers/reclassifications of financial
assets are permitted, except
66. Non-adjusting events that are indicative of a. Transfer from held-to-maturity investments
conditions that arose after the balance sheet date are to available-for-sale category.
given the following treatment: b. Reclassification of non-derivative financial
assets out of the fair value through profit or
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loss category if the financial asset is no longer
held for the purpose of selling it in the near
term in particular circumstances.
78. Financial reporting by a development stage
c. Reclassification of non-derivative financial
enterprise differs from financial reporting for an
assets designated at fair value through profit
established operating enterprise in regard to note
or loss by the entity upon initial recognition out
disclosures
of the fair value through profit or loss a. Only
category.
b. And expense recognition principles only
d. Transfer from the available-for-sale category c. And revenue recognition principles only
to the loans and receivables category a
d. And revenue and expense recognition
financial asset that would have met the principles
definition of loans and receivables (if the
financial asset had not been designated as
79. An entity shall disclose in the summary of
available-for-sale), if the entity has the
significant accounting policies:
intention and ability to hold that financial asset
a. the measurement basis (or bases) used in
for the foreseeable future.
preparing the financial statements.
b. all the measurement bases specified in
74. In which of the following circumstances is
the PFRS for SMEs irrespective of whether
derecognition of a financial asset not appropriate?
they were used by the entity in
a. The contractual rights to the cash flows of the
preparing its financial statements.
financial assets have expired c. the measurement basis (or bases) used in
b. The financial asset ha been transferred preparing the financial statements and the
and substantially all the risks and
accounting policies used that are relevant to an
rewards of ownership of the understanding of the financial statements.
transferred asset have also been transferred
d. all of the measurement bases and the
c. The financial asset has been transferred and the
accounting policy choices available to the
entity has retained substantially all the risks entity (ie specified in the PFRS for SMEs)
and reward of ownership of the transferred asset
irrespective of whether they were used by the
d. The financial asset has been transferred and the entity in preparing its financial statements.
entity has neither retained nor transferred
substantially all the risks and rewards of
80. An entity:
ownership of the transferred asset. In addition,
a. must chose to present either a statement of
the entity has lost control of the transferred asset
income and retained earnings or a statement
of comprehensive income and a statement of
75. When two or more venturers combine their
changes in equity (ie a free accounting policy
operations, resources and expertise to
choice available to all entities that prepare
manufacture, market and distribute jointly a
their financial statements in accordance
particular product such as aircraft is an example of
with the PFRS for SMEs).
a. Joint venture
b. whose only changes to its equity in the periods
b. Jointly controlled operation
for which financial statements are
c. Jointly controlled asset
presented arise from profit or loss, payment of
d. Jointly controlled entity
dividends, corrections of prior period errors,
and changes in accounting policy is required
76. A feature of government accounting that provides to present a statement of income and
for the ceiling or maximum amount an agency retained earnings in place of a statement of
can spend or incur in the performance of its comprehensive income and a statement of
functions is known as changes in equity.
a. Budgetary accounting c. whose only changes to its equity in the
b. Responsibility accounting periods for which financial statements are
c. Obligation accounting presented arise from profit or loss, payment of
d. Fund accounting dividends, corrections of prior period errors,
and changes in accounting policy is
77. A statement of financial position reports permitted but not required to present a
unrestricted, temporarily restricted and statement of income and retained earnings in
permanently restricted net assets is required for place of a statement of comprehensive
which of the following? income and a statement of changes in
I. A public university equity.
II. A private, nonprofit hospital d. that chooses to present a statement of income
and retained earnings must also present a
a. Both I and II statement of comprehensive income and a
b. I only statement of changes in equity.
c. Neither I nor II
d. II only
End of Examination
Thank you for participating in the 2011 National Mock CPA Board Examinations!
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