TOA Cpar

C'PA

Rt:VI[:\I'

SC'HOOL

OI-

I l-{l:

PHll-tPl'lN

t"s Marrila I I 101

l

THITORY OF ACCOLJNTS

Final Preboard Exantination

M{-JL'TIPLE

CHOICE : MARK

sheet

provided.

Make

lhe

mark

STRICTLY

NOT

ALLOWED.

,+.

,5.

Saturclal . ScPteniber 14. 8:00 a.rn.

to

l0:00

a.rlr.

SU'I'

A

FULLY i"ith

Pencil

Na. 2

tlre letter

of

your

choice

on

the att

DAR.K

trri

do

rr{,)t

usc

too

niuch

pressrlre.

uRASttlLtlS

I

tlnancial rcpolts tirr

llnanc ial reports

lbr

repons

ibr

external

'c:.tcittitl

Llscfs., I |ell(,r'is t()t'

c\t\'l'lltll

crterrral Ltsers, I I l I 2.

'SMt:s

irr its operling sturtcitrent

i .

hr

I'FRS ritr

SN4h.s.

I

il'the

PfrRS

lbr SMl.:

dt,c[

rrot I tianreiroll< as one type

ol',isset-,ilitr

ol

c()nrpoucnl ol'eqtrif -r

ahilities

I i

'h

to the c'quit-u- itnder I'['RlS lbr'

SnriilI tind rnediuur-sized entities are et'rtiiics that

3.

Do

not

ha.ve

public

accountability arrd pr"iblir!: speciel ptirpose

L}SETS.

h.

llalc

public

accorttrtiibiliti,and

publish gcllcrttl prlrpi)sc llttanciatl

LISC TS ,

ci.

Havr. p6blic

accol;ttabititl'

and publish speciai pllrpose tjnancial

Whicit

i'r^ray be cla.ssitred as a;r SME uitder Philippine.|urisiilctir:rr';'

a.

Banco De ()rrr

b.

Meralcir

c,

Sr-rn Lit'e Financial

d.

None oithese \\.er RH :is ot't

il

a

tirst-time

adopter presents

its

tlnr:nciai

:,tal;nrents

in

accordance

with

PFRS

fbr

SVII Decemher 31.2013 on comparative basis.

rvl,lt

is the,-jate

ol'transitiorl

to PFRS

lbr

SMEs'l

n.

I)ecer.nheril.201i

l^,.

l)ect't-uher 3

l.

201

]

c.

Jarruarf

i.l0ll

d.

.lanuary

l.

2010

All

of the

lbilowiltg

cillt

be cltue b1'a tirst-tirrle il(i()ptel'o1'[)FItS

lor

o1' flrrancial position. except

a.

Recognize

all

assets and lial-rilities

r

itt,s':

rtargtlitiorl

is required

h.

Rcc,rgtrize

all

assets and

liabilities

retltti''c'cl

t'l

tirll

Pi'RS even il require such recognition.

c.

Reclassii-v items that

it

recognizeC ulnder a pl'evious accounting f'

iiatrility

or component

olcquiiv

trrrt a clitli:ren1 t)'pe of esset- liaLri

d.

.\ppl)'PFRS

ibr

SMtjs

in measurin;'

:iil

rlrcggirized asscts ancl Iia

-[

he re'conc i l iation

ol

equity

uuder the prev

i':iri;

;c ;.rrti ng tian-ieworl

SMEs is made at

a.

The diite oi'trarrsition

to

PFR.S

tbr

SI\4H:r

onli.

b.

'The

erttl of the cLtn'ettt reporlilrg pe r,oti irtrlr'.

c.

I'lre clate oltransitir-lp

to

PFRS

tgr

i,M[:s;

litri

Lll tl-i'e eud

oltlie

cul't'cltt t'cportitrg pcriocl.

d.

I'he dare of transitiorr to PFRS fbr S!1[-:;

anii::r

tlrt

cnd ot'the prcccding cot.ltllaralive perit

-f

he components

oiother

cornprehensive

inctnre

,ri':rn S\(E, inc[,-tcle

ail

olthe fbllo*il1g.

exc€]

a.

Revaluation surplus during the year'

h.

Actuarial gain arrd lo-ss

c.

'l-he

eff'ective portion o1'gain

or

loss oir ir*rJgirig instntmetrts clesigtituter.l as cash

florl

hedg

d.

Liailr or loss

tiont

transiating the

flnancilil

.slatet-trents of a tbreign operatiol'l

7.

'1he

basic flnancial instnunents of an SME inclu,le all

of

the

fullowillg.

except

a.

Bank accounts

b.

Investrnents in nonconvertible and nonptrltali)e pr:efiretrce shares

c.

BLrurJs iind similar clebt in-slrLilneuts

d.

l-rlanr, 1o sLrbsidiaries or as;-cocintcrs u itlr snecillc rjalr:

ti'rrlalrtritl

C

D

C

Bank

Public Utilities

Insurance

B

C

A

January 1, 2013 naman yung Opening Statement

Pero January 1, 2012 yung beg. of comparative

period (beg of the previous yr)

=> SMEs has the choice if to OCI or to P&L 'to

Reval Method is not equal to FV Method

Cost Method ang SMEs so wala syang RE. Yung mga nirerevalue

naman sa FV Method, diretso sa P&L yun.

D

=> dapat payable on demand

____________________

8.

Which of the

tbllowing

statbrnents is

true

about the PfiRS _'cir SMEs

I'

_I

.

a.

U*der

the

tair

ualJe mddel.

thc

investmelrt

in

ass{ciate

is

initi:ii1'

nteastrr':l

at the transattlon

price inch-rdiirg transactibn

cost'

I

i

b.

Investnrent

p;;p.;,

i,

J',.rrur.cl

at either cost or

fdir

value'

c.

A gor.r,-,n,.,.,ilrarrt

relatecl

io

an asset n'ray be tr'eatecl

as

clelerred inc()i"ll3

or

reductictrt irt the

carrying atttount of tlre asset'

d.

A

parent need

not

presetlt

con*qolidated

iinancial

statentetris

if

the

parent has

onll'

one' subsidiarv

which

lvas acquired u,ith the intenrion

of'seliing

or ciisposing cif rt v'

itl'irl

orle vear'

9.

T'he tlrrancial

a.

Statenreut

b.

Statetnent

c.

Statetlent

d.

Staterrient

Statentents

of

a nttttnrutit

olgaliizi:tioll

includc

aii

Lif the

iolllririlg-

llieepl'

of flnarrc i al p'osirion

clf changes inl tirrrij balance

ofactivities

I

of cash t)ow:;i

nrenrbership deveiopment

actil'ities

of

a 1C.

i i

furicl i'aising anci N'lanageineut

and

generali

expenses-nonprotir organization are classilleci as

a.

Program serr,'ices

b.

Support ser"'ices

c,

Operating expenses

d.

Nonoperating expettsesi

I

Itiuh trf tlre

lbilo*irrg

u'o'u['J resttlt in ir;l illurt _{'tst' irt}

l"rl.''1li':rr'..

A

private

nonprotit irosIital

ea,'tterj intere::I

ol:

investtli]riiS

liiat

\\!

.\

norrprolit

organ

izati,iu

rec,-'i

vcd

tttrcslnditional prc

ili

ses',r-r

'edr"l

.1

rec!i'etl

i a donttr

l

l.

\\, a. h.

l3

A

nonprotit

vttluntarl

_{ealth

anil r,i,elf'are organizi.t{ion :eceived

who siipulate<J that

t[e honet,s5orilil

i1,',r i',,

'i

,i', r

iirrrii

r .-').1 'rt)

;;,;];;iii

o.gu'li'utit)rt

recciVecl cash

corrrl'ih'rtion

ii'oiri

a

Jottot

ri[1r

stipltlated

tliat

tire

ntolle\

be spept

tilr

eqr-ripmeut" none

o1',viri:h'lras aciluirer

lll

liltl

curl'elli l"ear'

Alt

gf'the

_fbllowing

_{are classif-red} a.s ilr-ianciril:'.ri:ii 'iti':s

ci'2;rsllf i"ii'nr'"1'r7a1ic'n"

except

a,

Cash contribution restricted b1 the dr:,i.:cr

fiir

i'ac'':lt.r drvrrir)pnlr"I'

b.

(lash contribution to Lre

penlattetlilv

it:r'trs,l':d'

c

Cash clividend and interest to bc Lrscd f111

3rrqllisrtilrl 'rt'-(\:r'lr'

'ijr'rqt:i;

;ll'

'lt

d.

Caslr

contribution

liom

a

cionor

who stip';iaieil

ti"ll-'t

tt

-

i''

_'-r''

i'

rf

i'll

ri-l ilccLrrdance

with

decision of the governir.rg board.

-flie

l'unctiorrs of

(lOA

incl[rde

ail

ot'the

ibilor"irj'''

t]'r;'i

_,.

i

it.

lg

exarriine" atrti sr.ttlc

ai]

:icci)riltt:i ,)ert;1n,lr$ tr.r

tirr

,'iii','r'.r'

:1t.,'-l _{'i:.))ct-'iiirilta:; o1'tlre naii00al}

gr)\etnntent

anil

its

suodit

istttits.

consliit-:;i,.;riltl

i{r,,i:i..,.

r).'

i r'l'rir,'tri-t

rri',:Lj

or

ctltltr0lled

corporatiotrs aud NGOs receivlr-lg s.rbSidl

ir3;ii

ihtl

[,)\'i]ir-.ilrf rlt

b.

["ti Iree p the general accot-tt-tts

of'lire

g{-)\'el'lllllc-ilt

c.

To

sublr]it

to

the

President

and

Congress

au

annur"l r1.rii..,..

c,i'the ,i:lticnal

goverru"nenl- lts subtlivisions and gor,erllrncllt-o\"tted

6t'ctli'lttiriicti

r',);g","

li

:;':

cl.

'l'o clesign. prepare alrd,approve the zrccot-intin{

ii}st'inl ':rig3

'(;i'r1};.}rrl-lt it:liilci--S,

l.t.

An appropriation is

a.

An

authorizatioti

by the

legislati','e

iroti'r

ttr

it'::i<e paitltt't-tisr i-'l;i

ol

g,J\'rlrilllient

tlnds

under

specitred conditions anci purposes.

fr

An

autliorizalion

by DBM

io

the

head

of

an

g-qenc'

tri

incut'

chlig'ilions v'ithin a

specified

anro Lntt.

c

rhe atlpunt

cot-tlmittet\ o1;

tt'nt'acted

hf

_{i'(')'r'8:'il!'lie} nt

acl;:!riistr;'tii

e

oiliciai'

d.

I hc practice

gl

gor. crnr-r-tcr-rt fbr"

pliiuriil:p.

pr'o;r,rar-tttrtitig

lii.'ii briillri:ti.ig ilrt'

iit

rlilabiiit\

ot't'uClne'1 tirr the l-ieceSSat\ sf rvicc:; expt:cicd r,1- tltc g(,', i'l'i'tllltlllt.

1,5. (ieneral income accounts of tl-re lro',/emulent

inclitcl,:':ii

oi'llle +i,ii.lilin!r

c\rt'pt

3,.

Filing

t'ees in a court

of'liiw'

b.

Dii

idend inconte

fionr

irtr estnterits

c.

Grants nnd dotratiotrs

d.

[:rncs ilrtd pcualtics fionr 12. anci ltse I 3::ts{'-'t'i tt,i'

"ii;

C Li}'iellt ti'e i'.'li '"'-l ilt;t::naleci. I I l, i:

D

B

B

walang

"deduction

from

asset"

method

and SMEs

A

D

D

If Board-

designated,

unrestricted

yun..

____

Unrestricted => Operating

A

D

=> DBM ang

gumagawa nito..

Appropriation

Allotment

Obligation

National Budget System

Gen. Income Accounts

Gen. Income Accounts

Gen. Income Accounts

16. Which of the foilov' inlr is

nct

a qualitative

a.

Materialit5'

b.

Linderstandabilitv

c.

Comparability

d.

Relevance

characte"istic

of

fi nancial statements?

i7.

Which

oi.the

fcrliowing is

frue

of

the qr-ralitative characteristic

of

"understandability"

in

relation to

inlormatio,t in

ilrrrncial

statements'7

a.

Users shoulci be

willing

to study the inf'ormaticn u,ith reasonable diiigence

lr.

Users are expected to have significant business knowledge

c.

Finaircial statements should exclude complex matters

d.

Finar-rcial statements should be fi'ee from material error

18,

Which

of tl-re

fbllowing

is

an

example

of

an "expense"'?

a.

A

loss on the disposal

ola

noncurrent asstt

b.

A

decrease in

equitl

arising tion1 a distribu.tion to equity participapts

c.

An

int.rease in ecernomic benefrts during the accounting period

d.

A

reduction

in

income for the accounting period

1g.

which

oltl-,e follow,ir-rg statements concerning lhe conceplual Framev'ork is

illcorrect?

a.

The

('ilnceptua!

F rarueu,ork provides th"at transactibns

must

be acc0unterJ

tbr in

accordance

with

their legal forrn.

b.

primary responsibility

for

the

preparation and presentation

of

the financial

statements

of

the

entity rests

witli

management.

c.

Financial statements must not exclude complex matters in order to achieve understandability'

d.

Where any

conflict

arises between the Conceptual

Frumeworkand

PFRS. the requirements

of

the PFRS prevail.

20. Which of the

foliorving

statements regarding

"profit'"

is

truc]

a.

prof rt is any

u*ol',nt

over and abJre thal required to r.itaintain the capital at the beginning

of

the period.

b.

protlt

_{is the residual amount ihat} rernains atier expenses have been deducted from income'

c.

Proflt is normally deterrnined using the frnancial capita! concept.

d.

All

of these statements are true.

2 i . Which of the

following

reports is nEt a component of the financial statements?

a.

Statement

of

financiat pcsition

b.

Statement of changes in equitY

c.

f)irectors" repofi

d.

Notes ro the finarrcial statements

22. Which of the

following

inforrnation is rrot :;pecifically a required disclosure?

a.

Name

of'

the

reportirrg

entitl,

or

otirer

means

of

identification. and any

change

in

that infbrmation from the previous

yrar'

b.

Nanres of itra.ior shaielrolders

oi'tiie

entit)".

c.

Level

of

rounding used in preserrting the fipanciai Statements.

d.

Whctl-ier the tlnancial statement,

"ou.,

the

indil'idual

entity or a group

of

entities'

23. When an eptity cpts to present the inccme slatement classifying expenses by

function'

which

of

the

tbllowing

is

not

iequired to Lre disciosed a-q "adrJitional information"?

e.

Depreciation expense

b,

Emplc,vee benefit expense

c.

Directors' remuneriltion d.,A"mor1!zation expense

24. Which of'fl-re

fbllowing

statements

in

relatiori ro materialitl, is

not

true?

a.

Ir4ateriality

of

items depends on their inclii,iduai or coliective influence on economic decisions'

b.

Materiality

of

an ilem depends on its :rb:.oiute size and nature.

c.

An

ite:l

must nrake a dif'ference or

it

ueed not be disclosed.

d.

An iterr

is material

if

the inciusion

or

omission

would

influence

or

change the judgement

of

a

reasona.ble person.

A

sub-quality of Relevance 'to

A

A

A

D

C

B

not legal

form but

substance

over form

net asset approach

_transaction

approach financial capita concept is based on historical cost..

C

B

25, Which of the

fbllowing

statements in relation to presentation

of

financial statements is true?

a.

Dividends paid should be recognized rn the statement of comprehensive

of

income,

b.

A

loss

on

disposal

of

noncurrent asset should

be

recognized

in the

statement

of

changes in

equity.

c.

Prorisions should be ri:cognized in the statement

of

financial position.

C.

,,\

revaluation su,i",lu:i

during the year

should

be

recognized

in

the

statement

of

changes in

equity.

26. Which of the l'ollowing costs of conversion cannot he included in cost

of

inventory?

a.

('ost of

iirect

labor

h,.

Factort' rent and r-rtilitii:s

c.

Saiarie >

of

:sales

stalf

d.

Factor\, overhead based on normal capacity

27. Costs which are inventoriable include

all

of the

following.

except

a.

Costs

that

are

directly

connected

with

the bringing

of

goods

to

the

place

of

business

of

the

br"ryer.

b.

Costs that are directly connected

with

converting

olgoods

to a salable condition.

c.

Buying costs

cf'a

purchasing department.

d.

Selling costs of a sales clepartment.

28. Which

of

the

following

is

not;rn

acceptable method

of

applying the

lower of

cost or net realizable value method to inventory'/

a.

Inventory location

b.

Group

oi'inventory

items

c.

Individual item

d.

Total of the inventory

29. Net realizable vaiue is the general rule fbr valr-ring which of the

tbllowing

types

of

inventory?

a.

Clommodities held by broker-traders.

b.

Computer components

hrld

lor

sale to manuf'acturers,

c.

Inventories priced on an item by itern basis but not those priced on a total inventory basis.

d.

All

of'the cht-rices are held at NRV,

30. How should an unrealized gain on foreign cLlrrency transaction be presented in a statement

of

cash

flows'7

a.

As an

inflow

under

"financing activities"

because

it

arises

fiom

a foreign cLlrrency transaction.

b.

It

should be ignored as

it

is an unrealized gain,

c.

It

should be Cisclosed in the notes to the financial statements by way

of

abundant precaution.

d.

As an adjustment to the net income under "operating activities".

31. How

shoLrici

r.paynlent

of

a

long,ierm

loan comprising repal'ment

of

the principal

amount and

interest.lLlt

tc

date be

treiled

in a staternent of cash f'loil's'l

a,

'l'he _repal,pent

_ol

_the

_principal

_{ioan is an investing cash}

_tlow

_{and the interest payment is either} an operating cash f'lor,v or a financing cash

flow.

b.

'1'he _repayment

_of

_the

_principal

_{loan is a financing cash}

_flow

_{and the interest payment is either} an operating cash 1'low or a financing cash

flow.

c.

The repaymerrt

ol

the

principal

loan is a financing cash

flow

and the interest payment is either an operating cash

tlow

or

investing cash flow.

d.

The repayment

of

the

principal

loan is a flnancing cash

flow

and the interest payment is netted against interest ieceived on bank deposits and the net amount

of

interest is shown as operating cash

flow.

32. An entity thal changeci an accounting

policy

should

a.

Infbrm sharehoiciers prior to taking the decision.

b.

Account tbr the change retrospectivelv

c.

'freat _{the effect of the change as an extraordinary itern}

d.

Accor-rr.rt for the change currently and prospectively.

C

C

D

A

A

D

B

B

How to account change in policy:

(1) according to transitional

provision

.

raEr 33. V/hen the residital i'alue

of

plant ancl ma.chiner''' hacl ,jrastica,ri',.h111!:ei!, the entity should

a.

Retrospectrvely change tire depreciation charge bas,vd r-,ri thc reviseci resiciual valrle.

b.

Change the depreciation charge and treat

il

as a correction

cf

a;: ,:rror.

c.

Change the annual depreciation for the eurrent ;,'eai and

iiiture

'/ears.

d.

Ignore the effect of

tlie

change on ar'nuai

depreciation.

,

34. Which

of

the

foltowing

sltouiC

not

[:,e _{ireated::is a} r hrrrge

ir

acciiuniin;r roiic,r'?

a.

A

new

poiicy

resulting

tioni

the require,;ient:

oi'i

rre\\ Plrl{S'

t,.

items

clf-

_ilropeny"

plant

and

eq.ripinerrt

erc

no\\

ileasurecl

at

f-air

value

rvhereas they:had previously been measured at cost.

c.

A

change

_"s

made

in

the

meihocl

rtt'crilculeting,

the pio',iisiott

jbr

uncoilectible

accounts

rece ir a'olc

C.

Investnrent properties

are now

measured

ai

fair'

.,'alue wltereas

ihev had

been

previously mea:-,urei1 at ;,-,st.

35.

An

entity deals extensivery

with

tbreign entil,ies. ar:ci the frnanciai statemer,ts reflect these tbreign currenc)'transactions. Subsequent to the er,r.!

oireporting

pet'iod, and before the the issuance

of

the

financial

srarements, there rvbre abnornral t'luctua.ticn::

in

l-r,-eign cun'ency rates.

How

should the

entity account for ti-ris event?

a.

Ac.iurst the i'trreign exchange year-end baiances

io

reflcci

the abnorrnal adlerse fluctuations in

16; c'i6ln ex;ha,ige rate.

t,.

,\cijuit

the lbreign

exchan5te year-end hirlances r.o

reflect

all

the

aLrnormal flr-rctuations in

lbrcign exchange rates and rrct"f r,tst ad'rerse tnc;','enicnts.

(r,

Disclose the post-rei;crtinlr perioii event as

r

nonadjustirig i:vent. 11. ignore the post-reponing pericd r"1en1-.

36.

Ail

of tlre

iitllowing

musi l:c ,-Ji,r:l,i::rrj Si.)i.rlr.r:tir-'ir. c'r*{'l}i '['l-re

tax ba:;es olnra.J()t itelns on r^.,nicL oei:r,,]"1 i:ti]i irali cc,:n caicttiated

I

lr.- autount oi'deduc:tible teiripclary di{-.feicrlc:s

tlri

r,r,hich no deferrcci iax ass!'t is r"ecognized ;

Ihe

antount

of

taxal:,le terrrporar-v- ciifteren,;es associated

,vith

invc'strnents

in

subsidiaries and

associates

tirr

v,,hrch no cieferreti tax

iiabiliti,

ts rei:cgnized.

d.

Th*

arnount

of

inccme

iax

reiating to each compcnent r:f oiher ,:omprel-iensive income

37 All

oI'iirc iollori,ing would

result to def'el'rec tax

a!!..-i

^y.'.:;i

a.

il,teiest e):pen:,e is accrurc, bui iirc'iuced itr

ru.0il:.

J

,iii

J;] a

c:sit

ursis.

b

i'he accurnulateii depreoiation on,jrrr,1SS,:rt is g:eaiel t,lan acc.r.-nriulated

tar

depreciilliorl.

r-.

Developrnent cost!-. have been capi'ti;iizeii

nnii amo{ized

hiit

v/r're

deducted

in

determining taxable

profit

in the perictri int.ut,','ir,.t"

d.

The'tax base

fur

a machinc, is _iireatcr tirarr .ii,:, cetrrving allloilr,t.

18,

An

entrt\

bought a _{prir.,ate -tet cxprecfecj}

to

tre uir:(i

.it,er

a pr'iici1

oi

,' yeirrs. -I'he engine

of

the

jet

has a llsefu! iif-e c''i

5

years. i'l-re pri'",ate

jr:t.s

t.r:es :iyr t'glila,rciJ e,,'er) 2. years.

fhe

piivate

jet will

deirreciated using the straight-line method *','cr

a.

7 yeais ccnrpr,rsite usetul

iift.

b.

.5 years useful

life oi'the

engiire.2. yeais usefLri iii..:

oi

thr

the balance ccst trf the _"iet.

c.

2 years useful

iife

basecl on i')onseli'aListn.

d.

5 y'ears rrseful

liie

based cu a

si;upit'ri.i'r;g?:ri

tlil;

r:-reiui

3g.Anentiryinstall:ciane\!proclictior-lle.;rilii:l<iirr-t-ti:c,.iaiti:rttierofr:xp',snsesatthepointof

installatiorr r:yhich inc.luded

initial

operatin;i lo.,iir:r '['lu, in::ia] ,-'p,:ra;iitg loss;s should be

a.

Defbried an{J anloniz,ed c'r.qr

r

r-;3strliat',[:

ptricti

!\i- ir-n'1.

b.

Expinserl anci clrarged to the incorne itlaiet(leitt.

c.

Capitalized as part c1'the cost

clpl:l'it

as

ir.iliiecti'" ;it:iilttt",bi'.r

cost.

d.

Cha,"rled

t:

ret,rinec.l earn,rg.l.

40.

An

entit),o\,vn:i

a fieet of

cars ;rnr.j

,,hri:s

11-:e r:r,tit;. licc;r:i,',1 :rtr

;tvatu(, lrie

properll', plant

and equiprneni. Which option shor-rld bc,;eier:ti.:ci

ii:

r.:l;,,iioti io th.:,,r',r.1;,2.1ir-rit?

a.

R.evaiui: only or:e-l-raiioi'caclt class o.l Drt-,pi:,1r,. _{; lr.:ri 3ri!i} aqr-,;pme nt'

b.

Revaiue an cn!ii'e class o-+ profr;t"I!. piar,t :.t-t,., elLriiril j(i1,1,

c.

Rerialue one ship at a tirxe as

it

is easirr

lii.li,

ie',,eiuirg

ali

sirins altr-,i;eiher.

d.

Since asset:r are being revaiu;ci iedulai]','" i;r';i'e

ir

li-) i1,,'t](i

.t

clepi'eciate. |,

(i

)

lire s. arr,J 7 years useflul

life

applied to

li't,e s

:rf'ali

rlaior

compcnents.

C

C

C

estimate 'to

A

Non-adjusting event 'to, pero NOT totally ignore, iDISCLOSE mo sya DTA is already calculated, i.e nasa F/S mo na sya Depreciate significant parts

C

B

B

B

All PPEs

are

revalued

to avoid bias

yage

o 41.

Which

of the

following

statements is correet?

a"

Assets are depreciated even

if

the

fairralue

exceeds carrying amount.

b.

Land and building are not ascounted

ibr

separately,, rvhen acquired together.

c.

A

noncurrent asset acquired as the resr.ilt

cian

exchange of assets is not recognized.

d,

A

gain on disposal of a noncurrent assef is classitied as revenue.

42-. _{Which of the}

_following

_{disclosures is}

_not

'*,r,-,iiet'i

lor troperty.

plant and equipment?

a.

Tl-re existence and anlounts

of

restrictior:: orr

iiric

b.

A

narrative discrission

of

f'uture capitai experrditure plans

c.

The depreciation rnetl-rod useci

d.

The measurement bases used

for

determining the gross carrying amount

4i.

Which of the

following

situations woulcl prirno {acie leadto a lease being classified as an operating

lease?

a.

Transf.er o.{''orvnership to the lessee at the end of ihe lease term.

b.

(r;,t-:,n _{to purchase at a valLle below tl,e}

_rail

_{vaiur oi'the}

_asset,

c.

ihe

lease term is

for

a major parl

olti,e

asset's

iiri.

d.

The present value

of

the

minimum

iease pa1'n.rents is 5Aoh of the

fair

value of the asset.

44. Wher:e thc-re is a lease

cf

land and

building

and the

title to

the

land

is

not transferred.

generally the lease is treated as

if

a.

The land is finance lease and the builciirrg is a finance lease.

h,

'fhe

land is a flnarrce lease and the

buiiding

is an ofrt-.rsii11g lease.

c.

fhe

land is an operating lease and the

building

is a ilnance lease

d.

The land is an operating lease and the

builriing

!s an operating lease.

45.

l'he

prot'rt on a finance lease

for

iessors w'ho ar,,'rnanui'acturers or dealers should

a.

Not be recognized separateiy from fiiiance incoinc

b.

Be recognized in the normal way on the trnnsa,.:tion

c.

Only be recognized at the end of the lease tei'm

d.

Be allocated on

a

straight iine basis over tl'ie

life

of the lease

46.

'"tlill

and

hold"

sales"

in

which delivery' is delayed ai the buyer's request but the buyer assumes tItle

and accef)rs invoicing. shoirld br: recognizeci ia,hen

a.

The '0u1,,j1 makes a-n order,

h.

The seller starts manufacturing the goocis.

c.

The

title

has been transferred but the goods are kept on the seller's premises.

d.

It

is

probable

that the delivery

will

be nrade" payment terms have been established" and the buyer has acknowledged the delivery instnrctions.

47 .

A

new entity has come out

with

an of'fer to ref'unc the cost

of

purchase

within

one month

of

sale

if

the customer is not satisfied

with

the product. "'01herr _{should the entity recognize the revenue?}

a.

When goods are sold to the customers,

t,.

After

one month

of

sale.

c.

Only

if

goods are not returned by the cusaomcrs after the period of one month.

d.

At

the

time

of

sale along

with

an offset

to

re'venue

of

the

liability of

the same amount

for

the

possibility of the rerurn.

48.

An entity

has decided

to

improve

its defincd henr:fil pension scheme. The benefit payable

will

be detennir-red b,"- ref'erence

to 60

years

of

ag:

rati:er

titan 65

_,r-ears

oi

age,

As

a'result^ there

is

an increase in the det'ined beneflt pension

liabilit.,.

j-{ow should the increase in the pension

liability

be treated in the trnancial statentents?

a.

fhe

past scrvice cost shor-rld be chargecl aga;n.st retained earnings.

b.

The prrs: se

tvice

cost should be charged againsi

profit

_{or loss for the year.}

c.

The past service cosr should be ailocc"ted over the remaining service period.

d.

The past service cost should not be recognized.

A

B

D

C

B

Sales type!

D

Bill & hold sales is not layaway sales

A

B

Sa sales-or-return, revenue agad..

49.

Which

of

the

fbllowing is

taken

intcr acco,-rni .,,/hen detei'ntining

the

rJiscolint

raie

in a

defilned benefit plan?

a.

N4arket yields at the end of reporting period on high-quality corporate bonds.,

b.

,nr'.r1rnent or dctuarial rislt.

c.

Specific risk associated r.vith th,j

erltity's

b,usiness.

;

. d.

Risk that tuture experiences may cliffer from actuarial assurnptions.

50. Which of the

tbllowing

statNments best clescriL*s

othc{ long-ferm

em1:io.*'pg henefits?

a.

ltJenefits

not

falling

ciue

wholly within

tvrelve months

ol

the

end

of

ihe peririd

in

which

the

service is

rendered

l

b.

Benefits

which

lall

due

within

t',relvc mi,nths

of

the end

of

the perioC

in

rvhich the service is

rendered

'

,

c.

Benetits payable as a result o1'an enritr''s ciecision to end an emplol'ee's enpioyrnent before the normai retirement date

d.

Beneflts which are pal,able

;,iii:r

cor.rnietion o1'ernr,loi,r,rclil

51. Which

ol'the

lbllowing

is

not

specilir:ail1, ex,-:iuded

lrom

gc;';ernrnent grant uncler PAS 20?

a.

Covernmenr particioation in ou,rlersnip

ol

lh,': *;riir"',

b,

Covernment grant ccvered by PAS 41 on agricr.il,ure.

c.

Gor,'ernment assistance providerl in the fbrm

of

ta.:;. bene fits.

d.

Forgivable loan

froni

the govei:nment,

52.

At

the beginning

of

the cumerrt year" an

entitv

recei.,eci

two gcvernrient

grants, namely Grant One as

financial

assislance

t-ol:-iart-ir.j

co;its llr:t,acl:, in::rrn,ll.,,Lrici

G'ant Two

as

s,,bsidi'f,ol

cost

o1-purchasirrg colxplitirr soiiivale. .:r,er ,i _),u'r,rrs Iv\ _{irieir r:l t.lr,-'}

_i;iic',v,ng

_{statL'merlts is true'.)}

a.

Crant One an.i Lii'ai--rt -iu'cr .iiroulli

!s

l'sgligiliz*c

u-t i-,..,1i in lhe cun'eni yea.r"

b.

Grant One and Grant

i'wo

shciuld be recogrrrzed over

)

)'Ears

u.

Grant One shoLrld be recognized

in

l-ull

il

ttre currei..t ye*r irrr'i Crant

Twr'

should be r:ecognized Orer 5 years.

d.

Grant One shor-rid be recogrrizeri

in fuli

iit ilie

crlrl-ir:nt

ri?:

.titui

Ciaitl

T',io

sirr:uld be recogr-rized

at

the end

of

-5 years.

53. Which of the

following

rvould

no{

be relevant in

rielrrniniirg

iit.'

lrr,r,cljritlai cttrrency?

a.

The currency that intluences the ccsts

oithc

er-rliit,

b.

The currency in

which

tin;rnce or fund is ge,relatecl.

c.

'l'he

currency' ir-r which receipts fi-oirr ,:pt-,r;riirrs :.*:ii..'ities:

a'':

.'r--t.,lrt..1

d.

'lhe

_{currency that is the n-rost}

_{internationaill}

_{:iccetr,tabje}

_ti,r

_lte,:1irg.

54.

At

which rate shoulel n(iilolrrrenr a:as;'.-q ite'rransla.leci when ih.'' f,.t:rc'i,:nai c-rrrency rigures are being

transiated into a

differerll

orc:-gr-jiati,,it cr.;r,'r-rl'i( V1

a.

l-he historical exchiinge raie

b.

The ciosing rate

c.

The average rate

d.

The spo't erchange rate

55.

Which

of the tblior,'.ing:siatenrents rbout tire capitalizlti{:t:^^

,f i:,r.:r,-,',itt'ctsts

as paft

oi'the

cost

of

a

qualiil'ing

asset is l.rue?

a.

If

tiinas

ccmt

tl'ont:lsiteiSi

bi-rro,.r'ir,,i,'- 1ii":

atrilr

llI

ir) r]i.: c;rt-,it.,lizc,l is based on the w'eighted average cosi {ii' i-r,rrrr.'r... i i.r-:.

h

Capitaliz:tlor

ai,+a),s conlittt,cs untii tlte assei is bro,lghi ir,lt.r il:,e

c.

Capitaiizatron always comlrlences ?S Soorr a.s i:xpcndirure

cithr;

ir!:;I

i.-. irt,']riti",.t(i

d.

Capitalization always ccmmences as soon a:, int.:rest cn le ie';a;rt Lia'ircni',,rgs ts being irrcurred 56. Wi-ren computing interest cosi to be capitalrzeiJ. the conriepr

oi"ir,.ld,rble

intcrest" ref-ers to

a"

The total interest cost actuali,v incurred,

b.

A

rr-rst of capiral charge for equity,

c.

'lhat poition of total

interest cost whicl-r vio,;lcl

not hiive

t:ee,r incuirred

if

expenditures

for

asset constmciion had not been rnade,

d.

That portion

of

a'terage accumulateci expenditu;:es on vvhich nc interesl. cost was incurred.

A

A

D

C

D

B

A

C

Other Long-term benefit

Short-term benefit

Termination benefit

Post-employment benefit

may PAS for Tax

current rate method

r aiic 57.

which

of the

following

is the recomrnencled approach to handiing interest incurred in, financing the

construction of property. plant and equipn:ent'i

a.

Capitalize only the actual interest costs incurred dr.ring construction' _

b.

Charge construction

with

all costs

of

funds employed, whether identifiable or not'

c.

Capitalize no interest during construction.

d.

Capitalize interest costs equal to the prime interesf rate times the estimated cost of the asset'

58. Which of the

following

is

not

a related paity:'

a.

A

director of the entity.

b.

The parent of the entitY.

c.

A

shareholder of the entity that holds 19'b stake in the entity.

d.

The son of the chief executive

officer

of

tht

enti!v'

59.

During

the current y,ear.

the

parent sold _lroods

to

the surbsidiary.

The

subsidiary paid part

of

this debt and then encountered flnancial

diificirlti,:s.

Aclministration costs are incurred as a result

of

the

credit controllers chasing the debt.

All

o1'the

fbllowing

are required

to

be disclosed

in

relation to this arrangement, except

il.

The costs of the credit control department incurred

in

pursuing the debt

b.

Details of any guarantees received in relation to the outstanding balance

c.

The provision

in

relation to the debt being uncollectible

cl.

The amount of the transaction and otitstandinq balance

60,

An

entity acquired an investment

in

a subsidiary v,,ith the view to clispose of this investment

within

six

mcnths. The investment

in

the subsidiary l-,as been classified as held

for

sale.

How

should the investment in the subsidiary be treated in the t-ir,atrcial statements?

a.

Purchase accounting should be used.

h,

Iiquity' accounting should be used'

c.

The subsidiary should not be consoiid;ited but FFRS 5 should be used'

d.

The subsidiary should remain

off

statement of tlnancial position'

61.

An

entity controls an overseas

entity.

Because ct'exchange controls.

it is.ditflcult

to

transf-er funds out

of

the country to the parent entity. The parent

ouns

100%

of

the

voting

power

of

the overseas

entity. How should the overseas entity be accounted tbr'?

a.

It

shouid be exclucleci from consoiidation and the equity method should be i"ised'

b.

It

should be excluded from consolidation and siated at cost.

c.

lt

should be excluded from consolidation an<i a.ccounted

for

in accordance

with

PAS 39'

d.

it

is not permitted to be excluded from cor,solidation because control is not lost.

62. How is the impairment test carried out for an inrrestment in associate?

a.

T'he

goodwill

is separated from the rest of the investineni arrc rs impairmenttested

individually'

b.

'fhe

entire carrying

amount

of

the

investment

is

tested

for

impairment

by

comparing

its recoverable amount

with

the carrying amollllt.

c.

The carry,ing amount of the investmertr slrorriti be cortrpared

rvith

its market value'

d.

The

recoveiable amounts

of all

invesinienr:;

in

associates shoulci

be

assessed together to determine whether there has been an impairinent on

all

investments.

63. Delrt investments held

for

collection

arc reported ai

a.

Amortized cost

b.

Fair value

c.

The lower

of

amortized cost or

thir

valuc

d.

Net realizable value

64. Which

of

the

following

is not

generally correct a.bout recordirrg a sale

of

a debt investment betbre

maturity date?

a.

Accrued interest

will

be received by

tlie

seller er,en though

it

is not an interest payment date'

b.

An entry must be nrade to amortize a discount to the date

of

sale.

(..

The entry to amortize a premium to thr: dat.:

oisale

includes a debit to Cebt investment'

d.

A

gairr on the saie is the excess of the seiting price over the cartying arnount of the debt'

A

C

A

C

B

B

A

C

specific borrowing

Related-

party

tranx

held-for-collection ex. is A/R

65. lnvestments in tradir-rg deht investments are generaily reported at

a.

Amortized cosi

b.

Face value

d.

Marurity value

rage

v i l i i

66. Under the

fair

value

optionl

entities

a.

fi,rnrprlhensiveincome

h.

Irrcornc'

c.

Equin

d.

Othr:r corrprehensive i,rr:cnre 67.

If

the

investor

owns 60%

of

the

generall-v account

for

this investn:ent

l

report

all

changesiin

lair

valLte in I

i

investee's outstanding

oroinery

shares,

the

investor under the

l

shbuld

rr

Cost method

b.

Fair value rnethod

c.

Consolidation equity method

C.

Consolidation method

68.

An

entiiy declares and distributes a cash diviileni', ihat is a rt':,,.rli

rf

cu"rert

eamings.

How

will

the

receiprt of those dividends affect

lhr

inr,,r:sll'i,J;ti :-r.1-r,j,)!lrt

ol'tirc

ii:r'eslor ur:d*r each

of

the

following

accounting methods?

'

_a.

No

eilbct

under f.air value method and de

:reasi

under eqr,rity' raethoC

b,

Increarse under

tair

value nietirod and dccr"e.'se r,ir-rder equity method

c.

No i:lt'ect untJer both

fair

vaiue metlroi-l anrl, ,:ril-riiy method.

d.

I)eclease under'fair value

lretiic{i ;ir'd:ro,:fibct

un'ler equitv methoci.

69.

All

of tl-ie tbllou,ing are characteristics

of

a cleril,a,tive f'lnancial in.-tmmtnt. excep'

a.

'fhe

instrument has

iJle uf

iiii)ic

rir,r'i:l 11i:;r: r'rnri

rli

i,lentilled

payment l)rLr\ ision.

ir,

'l'he _{instrurnent requires a}

_iarg*

_{rr.,'ec.nlcni::ri 1r,:}

_i:rlci;tior

_nf

_tle

_rr.rnt;'acl

c"

fhe

ir-rstnrmett requiires

oi

pelii;t:

;tct se1Ller',*,ii.

d"

AII

of these a.re characteristics.

70.

All

of the

fbllowing

arc ntoirciit;'', lten,:., r';rcrpt

a.

Trade payables

b.'I'rade

recei.u,abir:s

c.

Adn-rinistration costs paid in calh

d.

Loan repayable at par

vrlue

72.

An

entity is reporting in a hyperintlationary errcncfrl). Which of tlre follor.l'ing statelx.ents is true'?

a,

There is a loss on the net n:onetary'position

ii'rhc

tronetar)'assetJ exceed nronetar)'liabilities.

b.

l'liere

is a gain on the net rnonetarr posilion

iithc

mrneta"r;,'liahilities excec'd nronetary assets.

c.

Ttrre gain or lcss in the net monetar.y position is recognized in

profit

or loss.

d.

All

of these statements are true

What are the conditions

lbr

oi'lseiirn:r ci-financial

assets ancl fiiranr:ial

iiabiiities'/

a.

A

legal right

of

set-oi].

b.

A

legal right r-rf set-otf and an intention to scrtle net or simultaneousiy.

c.

The existence

of

a

clearing

mechanism

or

other

miirket

i-rrechanisrn

lor

net _{-settlement and} an

expectation of net settlement.

d.

,A riettirrg agri:emerrt anr, an erpect:tir-.r c I n':t sel,tle-r,eyir.

For what items is f'air vair-re

requilrrl

to be rii:i.-ll:,J,i rru;ler PAS

32'l

_arti

_.:.

a.

All

flnancial

irrstnrmenrs

'

,iifu

b.

All

tlrrancial instruments. excepl. Lrnilur-rled r:qliit,v instrrrrn'i:r,t.s alr,: derivaiives linked thereto

c.

All

tlnancial assets and

linancial liabtlilies.

txr:iJilL

ior

ii",v.,1s1ments

in

unqtiuted instruments and

delivatives linlied

therero.

L:

d.

All

ilnanciai

assets.

except

for

invesiire".]t

lr

u,rcluotllirir,rr:1runen1s

and derivatives

linked

thereto.

I 71 73.

C

B

D

A

B

C

D

B

small investment lang

Asset or liab lang ang monetary items

expense account

74^ Which of the

following

statements

in

relllicn

to financial instruments is true?

a,

Treasury shares are recognized as fina:rcial assets'

b.

Any

gain or loss on tr.ur=,rry share transactions is recognized in

profit

or loss

c.

Transactions costs

of

issuing equity instruments are charged against income'

d.

The

components

of

a

compound

finarcial

instrument

aie

classified separately

in

accordance

with their substance.

7_(. Dividends in respect

of

redeemable prefcrence shares aie

a.

Not recognized

b.

Recognized in

profit

or loss as compontnt of fi'nance cost

c.

Recognized directlY in equitY

d.

Recognized

directly

in other comprehensive income

76. Earnings per shai'e is calcr.rlatecl before accortnting,

for

which of the

follorving

items?

a.

Pret'erence dividend

tlli

the peric'<!

b.

OrclinarY dividend

c.

Taxation

d.

MinoritY interest

77. Ordinary shares issued as part of a business ccmbination are included in EPS

fiom

e.

fhe

beginning of _{the Period}

b.

l'he

date

of

acquisition

c.

The end of _{the Period}

d.

The n'ridpoint of _{the Period}

78.

lf

a. botrus issue

occurs

between

the

yt:ar-enci a'nci

the

date

that the tlnarlcial

statements are authorized

a.

EPS both fbr the current and the pret,i:,trs vear ,3re adjustcd.

b.

EPS fbr the current year

only

is adjusted'

c.

No adjustment is made to EPS. d. Diiuted EPS onlY is adjusted.

79.

Ail olthe

tbllowing

items must be disclo-qe:] ,n

reiationto

earnings per share' excepf

a.

Forecast earnings per share for the follow'ing linancial year

b.

Instrurnent

thaicould

potentiallv

dilute

Lraiic earnings

per

share

in

the

iuture

but

were

not included in the diluted EPS becaisc they are

antidilutive

in ttte current period

c.

The weighted average number of ordir,ar"y shares used to calculate earnings per share

d.

'fhe earnings tigureJused in calcula:ing't',:isic and diluted earnings per share

-

80. Prlblicly traded entities are encouraged tr.l pro'"ide interim t.inancial reports

a.

At

least ar rhe end

of

half year

ani within

6C days

ol

the end

of

interim period' b.

Within

a month

of

the half year-end.

c.

0n

a quarterlY basis'

d. Whenever the entitY wishes.

81. There is a presumption that anyone reaCing i:rterim financial reports would

a.

Understand

ali

enllippine

Financial Renortrng Standards'

b.

l.Iave access to the records of the entity'

t;.

Have access to the most recent annual reF'ort'

cl.

Not

make decisions based on the report'

g2.

_which

_{of the}

_following

statements in relation to

inteiim

{inancial reporting is

not

true?

a.

An

interirn

financiil

report mav cons'si

rria

r;cndensed set

of

financiai sratements'

b.

An

interim financial report rnay consisl of a r:<;:nplele set

of

financial statements'

c.

It

is necessary to count inventories in

full

at the errd of each interim period'

d.

The

NRV

of inventories is determined by refbrence to selling prices at the interim date'

g3. When deciding on the discount rate

to

tre tiseci in caiculating value

in

use. which

factor

shouid not

be taken into account'J

a.

The time value

of

moriey

b.

Risk specific to the asset

fbr

which

c.

Risk specific to the asset

for

which

d.

Pretax ra.te

firtr.rre cash

flow

estimates have not been adjusted'

future cash

flow

estimates have been adjusted'

D

B

B

B

A

A

A

Bonus issue = stock dividends

is an adjusting event..

C

C

C

dapat NOT

adjusted ang

CFs

-

g4.

_An

_impairment loss lirat relates to an asset that has been revalued shor"rld be recognized in

a.

Profit or Ioss

b.

Revaluation surplus that relates to the revalued asset

c.

Openir-rg retained eamings

85. Which of the

following

impaimrent losses should never be reversed?

a.

i.oss on property. plant and

equipment

i

t,.

l,oss on

good'rvill

'

c.

I-oss on business

segment

I

d.

Loss iitr inventorY

86. For

which

of the

following

should a provision be rei'.ognized?

a.

Future operating losses

b,

Obligaticlns under insurance contracts

c.

Reductions in

tair

value

of

f-rnancial instruments

d.

Ohligations

tbr

plant decommissioning costs

87. Provisions shall be recognized fbr all of the

following.

except

a.

Cleaning-up costs

oi

corrtaminated land wheir an

oil

entity

has a published

policy

that

it

will

un<Jertake ttr clean up

all

contamination that it cattses'

b.

Restructuring costs after a binding sale a-ureement has been signed

c.

Rectit.icatii,,i.nrt-

relating to

detietive

piotlucts already solcl

r'1.

Future refurbishment costs due to introduction of a new computer system

88.

Which of the

following

disclosures is

not

required

with

respect to intangible assets?

a.

Usefirl lives of the intangible assets.

b.

Reconciliation of carrying amount at the beginning and the end of the year.

c.

C-'onrractual commitments for the acquisition

of

intangible assets,

d.

Fair value

of similar

intangible assets used

by

competitors.

89. Which o1'the

following

statements in relation to research and development is true?

a.

'['he product being*developed should have already been put into commercial proCuctitln or use'

b.

Expenditures

duiing the

research phase

of a

project

lla)

s,rmctimes

til

capitalized as

an

irrtangible asset.

c.

Expenditures dr-rrilg rhe development phase

ol

a

plo.iect may sometimes be capitalized as an

intangible asset.

d.

All

of these statements are true,

90. Which of the

follou,ing

-statements in relation to intangible assets is true?

a.

Intangible assets

with a finite

useful lif'e

should be measured

at

cost and tested annually

for

impairment

b.

lntangible

assets

acquired

in

a

business

combination should

only

recognized

if

they

have

i

already been recognized by the acquiree'

c,

Intangible assets acquired-in a business combination should not be recognized separateiy

fiom

goodrvill

d.

Atl

of thes.. statentents are not trLle.

91. What is rhe etfectir,e interest rate ot-a debt instrument measured at amortized cost?

a.

The stated rate

of

the debt instrument.

b.

'l'he _{ipterest rate currently charged by the entity or by others}

_{ior similar}

debt instrument'

c.

Ihe

ipterest rate

that exactly

iir"ornt,

estimated

future

cash payments through

the

expected

l tif-e of the debt

instrument

to the net carrying anlounl- of the instrument.

d.

'i'he basic"

risk-fiee

interest rate that is derived

fiorn

observable price.

92.

\t

what amount is a financial asset or financial

liability

measured on

initial

recognition?

.

a,

The consideratir:n paid or received for the financial asset or financial

liability

tl.

Acquisition cost

c.

Fair vaiue

d.

7.ero

B

B

D

D

D

IFRS 4

PFRS 9

=> no present

obligation yet..

C

D

C

If may

FINITE useful

life, test

only for

impairment

if may indication

C

,

93.

Which

oi

the

fbllowing

additional

disclosures mr:st

be

made

when an

entity

chooses

the

cost

model as the accounting

policy tbr

investmei-rt properly?

a.

The

tair

value of the _ProPertY

b.

The present value of the propert)

c.

The value in use of tire ProPertY

cl.

The net realizable value

of

the propertv

94. Which

of

the

following

ciisclosures shoulcl be rnade when the

fair

value model

has been adopted

for investmen'. prope;'i.r .'

a.

Depreciation method usecl

b.

The amount

of

impairmetrt ioss recognized

c,

LJseful lif'e or d'^preciation rare ttsed

d.

Net gains or iosses

iiom

fair

vah-re adiustments

95.

Ap entity

l-rad a plantation forest that

is

likely

to

be harvested and sold

in

30 years.

The

income should be accounted

tbr in

which of the

fbllowing

way?

a,

N-o income should reported annually

until first

harvest and sate in 30 years'

b.

lnco6e

should be measured annuaily and reported using a t-air value approach

that

recognizes ahd nteasures biological growth.

c.

The e\/entual sale

pr,r..idr

should be estimated and matched

to

the

profit

and

loss

account

o';er iire 30-year period.

d.

The plantaiion ibrest should be

valued

every

5

years

and the

increase

in

value

should be

shown

in

the

statement

of

comprehensive

in.otn.

as

component

of

other

comprehensive income.

96. Where there is a production cycle

of

more than one year

for

a

biological

asset" separate discl'rsure is encouraged

ibr

a.

Physical change only

b.

Price change only

c.

'fotal

cirange in value

d.

Physical change and price change

97. Man1, shai'es ancl most share options are

not

:r;r.clecl

in

an active market.

Which

o1'the

following

option valuatiorr *.echniques shoulct

nof

be lised iis a rneasure

of fair

value

of

share options

in

the

first

instance'?

a.

Black-Sholes model

b.

Binomiai ,nodel

c.

Mont':-Carlo model

d.

Intrinsic value

98. The "excess

of

the acquirer's

interest

in

the net

fair

vah-re

of

the

acquiree's

identifiable

assets'

Iiabilities and contingent

tiabilities

should bt:

a.

r'\mortized over the lif-e of the assets acquirec:

b.

Reassessed as to accuracy

of

measurement aniJ then recogniz.ed immediately in

profit

or

loss'

c.

Reassessed as to accuracy

of

measurement and then recognized

in

retained earnings

d.

Carried as a capital reser\/e indefinitely.

99. In

ordei"lor

a noncLlrrent asset

to

Lre classified as held

for

sale. the sale rnust be "'highly probable"

which means ihat

a.

The fr,rtr-rre sale is

likely

to r.rccrir'

b.

The tuture sale is more likel,v than nct to occrtr,

c.

The sale is cerlain.

d"

The

probability

is higher than more

likelv

thari t.ti,-t,

100.

Exploration and evaluation asset should

a.

Not

Lre recognized in the flnancial statements,

b.

Be classified as tangible asset

c,

Be ciassitred as intangible asset

d.

Be classified as either tangible asset or intangible asset

trND

A

D

B

D

usually, kaya ka nag-cocost model

kasi wala FV na available..

Biological

asset is

FV approach

D

B

D

a, b, c are all valuation method

possible

probable

highly probable

D