CFAS - QUIZ QUESTIONS

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Which of the following shall be accounted in accordance with PAS
38?
a. Patents and copyrights
d
b. Trademark
c. Franchise
d. all of the given choices
Which statement is true concerning government assistance?
I - The receipt of government assistance by an entity is significant
for the preparation of the financial statement to give an indication
of the extent to which the entity has benefited from such assis-
tance.
II - Receipt of a grant provides of itself conclusive evidence that a
the conditions attaching to the grant have been or will be fulfilled.
a. I only
b. Both I and II
c. Neither I and II
d. II only
A qualifying asset is an asset that necessarily takes
____________________________ to get ready for its intended
use or sale.
a. at least 6 months c
b. at least 12 months
c. a substantial period of time
d. no more than 12 months
Which of the following statement do agree with IAS 36?
a. An entity shall assess at the end of each reporting period
whether there is any indication that its assets may be impaired.
b. All of the given choices agree
a
c. An entity shall assess at the end of each reporting period the
recoverable amount of its assets.
d. An entity shall test its assets on impairment at the end of each
reporting period.
How is excess of cost over carrying amount accounted for under
PAS 28?
a. If the amount is attributable to goodwill, it is included in the
carrying amount of the investment and not amortized.
b. If the excess is attributable to undervaluation of depreciable a
asset, it is amortized over the remaining life of the investment
c. it is ignored
d. if the excess is attributable to the undervaluation of inventory,
the amount is expensed immediately
Which of the following terms does this statement define: "the
amount by which the carrying amount of an asset or a cash-gen-
erating unit exceeds its recoverable amount"?
a. Depreciation b
b. impairment loss
c. Fair value
d. value in use
Which of the following cannot be a qualifying asset?
a. investment properties
b. financial assets b
c. Intangible assets
d. manufacturing plants
Carrying amount is the amount at which an asset is recognized
I - After deducting any accumulated depreciation
II - After deducting accumulated impairment losses, if any
III - Before deducting accumulated impairment losses, if any b

a. I and III only

b. I and II
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c. II only
d. I only
The existence of which of the following in the entity's internal
reporting does indicate that an asset may be impaired?
I - Cash flows for acquiring the asset, or subsequent cash needs
for operating or maintaining it, that are significantly lower than
those originally budgeted.
II - Actual net cash flows or operating profit or loss flowing from
the asset that are significantly worse than those budgeted.
III - A significant decline in budgeted net cash flows or operating d
profit, or a significant increase in budgeted loss, flowing from the
asset.

a. II only
b. I and II only
c. III only
d. II and III only
Any unallocated positive acquisition differential under the account
investment in associate is normally:
a. pro-rated across the Associate's fairly valued assets.
c
b. charged to Retained Earnings
c. attributed to goodwill
d. expensed during the year following the acquisition
Which of the following does not define investment property?
I - Property held to earn rentals
II - Property held for capital appreciation
III - Property used in the production or supply of goods or services
a
a. III only
b. II only
c. I only
d. I and III only
An entity shall not recognize a contingent liability
a. none of the given choices
b. Unless a reliable estimate can be made of the amount of this
liability a
c. unless an entity has a present liability as a result of a past event
d. unless it is probable that an outflow of resources embodying
economic benefits will be required to settle this liability
Agricultural activity is the management by an entity of the biolog-
ical transformation and harvest of biological asset for:
a. Conversion into agricultural produce
c
b. Conversion into additional biological assets
c. all of the given choices
d. Sale
Which of the following is not an example of a financial asset/lia-
bility?
a. A contract that will be settled in the company's own equity
b
b. Advances received on a construction project
c. You Answered Shares
d. Cash
An onerous contract is a contract in which ________________ of
meeting the obligation under the contract __________________
the economic benefits expected to be received under
a. Avoidable costs; are less than d
b. sunk costs; exceed
c. Opportunity costs; are less than
d. unavoidable cost; exceed

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Which of the following statements is true with regards to an
investment property?
a. An investment property generates cash flows largely indepen-
dently of the other assets held by an entity
b. The value in use of investment property is significantly higher
a
than of owner-occupied property.
c. An investment property owner-occupied property shall always
be measured at its historical cost.
d. An investment property unlike owner-occupied property shall
not be depreciated over its useful life.
A major distinction between temporary and permanent difference
is
a. temporary differences reverse themselves in subsequent ac-
counting periods, whereas permanent differences do not reverse
b. temporary differences occur frequently, whereas permanent
differences occur only once. a
c. permanent differences are not representative of acceptable
accounting practice.
d. once an item is determined to be a temporary difference,
it maintains that status, however, a permanent difference can
change in status with the passage of time
The deferred income tax liability:
a. Can result in a deferred income tax asset
b. Is never recorded.
c. Is a contingent liability d
d. Represents income tax payments that are deferred until future
years because of temporary differences between GAAP rules and
tax accounting rules.
Which of the following shall IAS 41 be applied to?
a. Agricultural produce at the point of harvest
b. Land related to agricultural activity. a
c. all of the given choices
d. Bearer plants related to agricultural activity
How is an equity instrument defined?
a. The instrument includes no contractual obligation to deliver
cash or another financial asset.
b. The instrument includes no contractual obligation and the in-
strument will/may be settled in the issuer's own equity instrument a
c. The instrument includes a contractual obligation and the instru-
ment will/may be settled in the issuer's own equity instrument
d. fThe instrument includes contractual obligation and will/may be
settled in the issuer's own debt instrument

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