FINAL EXAM

Part 8

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36. Leases are accounted for under

a. PAS 16
b. PFRS 14
c. PFRS 15
d. PFRS 16

37. PFRS 8 relates to which of the following?

a. Disclosure of operating segments
b. Disclosure of related party relationships and transactions
c. Disclosure of events after the reporting period
d. Interim financial reporting

38. You are the accountant of ABC Co. During the period, ABC Co. acquired short-
term investment in stocks, which of the following financial reporting standards
would most likely be relevant in accounting for the transaction?
a. PFRS 8
b. PFRS 9
c. PAS 28
d. b or c

39. You are a CPA and were engaged to audit the annual financial statements of ABC
Co., a mining company. Which of the following standards is most likely relevant to
ABC Co.?
a. PFRS
b. PAS 34
c. PAS 41
d. PFRS 6

40. You are the accountant of ABC Co. During the period, your company acquired
majority holdings in XYZ, Inc. This transaction gave rise to goodwill. Which of the
following standards will be referred to in your company’s notes to the financial
statements under summary of significant accounting policies?
a. PFRS 3
b. PFRS 10
c. PAS 36
d. All of these

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 Essay # 1. Introduction to Accounting:

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Several thousand years ago when human beings first developed the need to
accumulate information about economic resources such as land, livestock and other
personal property, accounting got originated. With the invention of money there
was an ease in the manner in which commodities and services were exchanged.
Money became a unit of measurement. Throughout history accounting profession
has continued to grow in response to the ‘financial information needs’ of individuals
and societies.

Accounting is a function of economic and social development. It is the

language of business. It records business transactions on a monetary basis in a set
of books in a scientific manner. Cash plays a vital role in all types of business
activities. One party pays it and the other party receives it. Even in non-cash
transactions, cash has to be paid or received in future. Accounting provides
information in a classified and a summarized form as financial statements.

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February 23, 20x2. The financial statements are made available to

shareholders and others on March 1, 20x2. The shareholders approve the financial
statements at their annual meeting on March 18, 20x2 and the approved financial
statements are then filed with a regulatory body on April 1, 20x2. Events after the
reporting period are those occurring.

Respected for their honesty

You are the sole proprietor of Entity A. As a requisite to your business loan
application, you were required by the bank to submit audited financial statements.
During the audit of your financial statements, the auditor questioned the carrying
amount of your land. are quite dishonest and are putting a black mark on the image
of the entire profession. There is one area where the CPA profession has fallen short
of protecting.

Cash method. If you use the cash method of accounting, you record income
only when you receive cash from your customers. You record an expense only when
you write the check to the vendor. Most individuals use the cash method for their
personal finances because it's simpler and less time-consuming. 354657IJNM

Essay on Accounting: Meaning, Functions, Importance, Principles and

Limitations
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 ADVERTISEMENTS:

Essay on Accounting :- 1. Introduction to Accounting 2. Meaning of

Accounting 3. Functions 4. Importance 5. Systems 6. Principles 7. Concepts 8.
Accounting Conventions 9. It comprises Trading Account, Profit and Loss Account,
and Balance Sheet. Account is that aspect of accountability that accounts for the
purpose for which cash is paid or received. Trading Account and Profit and Loss
Account are prepared to ascertain the profits earned or losses incurred for a
particular period. The balance sheet shows the financial position of a business as at
a particular point of time.

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Accountants are the practitioners of accountancy. They are information

specialists who collect, process and report economic information about specific
financial events for business and non-business activities. Today, we observe several
million individuals engaged in professional accounting activities and several billions
dependent on such information. Thus, accounting has a wide scope in the spectrum
of economic and social development of any country, be it developed, developing or
backward. and its Users
Essay on the Systems of Accounting
Essay on the Principles of Accounting
Essay on the Concepts of Accounting
Essay on the Accounting Conventions
Essay on the Limitations of Accounting

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