Test your basic knowledge |

Subject : business-skills
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Must disclose nature of operations - use of estimates - estimate of a change in estimate - vulnerability of the risk f near-term severe impact from a material concentration.






2. Revenue recognized when realized or realizable and earned. Four criteria must be met for each element of a contract before revenue can be recognized: persuasive evidence of an arrangement exists - delivery has occurred or services have been rendered






3. Impairment losses recognized in income statement and cost basis is reduced. If held-to-maturity - subsequent changes are not recognized. If available-for-sale - subsequent income is included in OCI.






4. All gains and losses included in OCI






5. Percentage of completion and completed contract method allowed.






6. If year of change - all previous financial statements that are presented in comparative format along with the current year are to be restated to reflect the information for the new reporting entity.






7. Lessees--operating or capital leases. Lessors--operating - sales-type - or direct financing leases.






8. The subsequent event evaluation period extends through the date that the financial statements are issued (public companies) or the date that the financial statements are available to be issued (all other entities). Subsequent events are classified as






9. Recognized in a two-step process: (1) recognition of the tax benefit (2) measurement of the tax benefit.






10. Bank overdrafts are excluded from cash and classified as financing cash flows.






11. Enacted tax rate only.






12. For lessee - at least one of four met: (1) ownership transfer (2) written BPO (3) FV of leased property at least 90% of lease payments (4) lease term at least 75% of asset's life. Lessor: sales or direct financing if one of above criteria met and : (






13. Two Step Test: (1) test for recovery: compare carrying value to undiscounted future cash flows (2) calculate impairment: difference between carrying value and fair value. Reversal of impairment losses is only permitted for assets held for sale.






14. May be presented as a primary financial statement or in the notes of the financial statement.


15. Costs before technological feasibility must be expensed - costs after technological feasibility are capitalized.






16. Funded status is reported of an overfunded pension plan is reported in full as a noncurrent asset. Underfunded plans are reported as current - non-current - or both.






17. Considered non-compensatory if they meet certain requirements.






18. Not required to match consumption. No requirement to review method - life - or salvage value at year end. Can use composite or component depreciation.






19. Finite life intangibles - two step process: compare carrying amount to undiscounted cash flows - then if carrying amount exceeds cash flows - impairment amount is the difference between carrying amount and fair value of asset. For indefinite life - c






20. Existing condition - situation - or set of circumstances involving varying degrees of uncertainty that may result in the decrease in an asset or the incurrence of a liability. A provision for a loss contingency should be accrued with a charge to inco






21. Entities cannot apply the FASB conceptual framework to specific accounting issues






22. Prior service cost increase the PBO and other comprehensive income in the period incurred and is then amortized to pension expense over the plan participant's remaining years of service.






23. Best method that clearly reflects periodic income. Does not need to have a rational relationship with the physical inventory flow. LFIO is permitted.






24. Entities are required to disclose concentrations of credit risk. Market risk disclosures are optional.






25. Should be classified as current or non-current based on the classification of the related asset or liability. If no asset/liability - timing of the reversal is used. All assets/liabilities must be netted (one net current and one net non-current).






26. Contracts that may be settled in cash or stock are not included in diluted EPS if circumstances indicate that eh contract will be paid in cash.






27. All adjustments for changes in deferred tax balances due to changes in tax laws or rates are recognized on the income statement.






28. Probable is defined as likely to occur and reasonably possible is defined as more likely than remote - but less than likely.






29. No separate recognition is given to the conversion feature when convertible bonds are issued. Bonds are recorded in same manner as non-convertible bonds.






30. Indirect direct costs paid by the lessee are expensed when incurred.






31. Includes disclosure of significant estimates but not judgments made in preparing the financial statements.






32. Components of net periodic pension cost are SIRAGE: service cost - interest cost - return on plan assets - amortization of prior service cost - gain/loss amortization - existing net obligation/asset amortization.






33. No requirement for disclosure of key management compensation arrangements.






34. Single - two - or in statement of changes in owner's equity. Presentation of changes in owner's equity is phasing out completely by 12/15/2012.






35. Recorded as an asset and amortized using the straight-line method.






36. Components of net periodic pension cost must be aggregated and presented as one amount on the income statement.






37. Recognition of gains is dependent on the rights of the leased property retained by the seller-lessee.






38. Two step test: fair value of reporting unit compared to its carrying value - including goodwill. If fair value is less than carrying value - an impairment loss is calculated by comparing the implied fair value of the reporting unit's goodwill to the






39. Slight variation from year-end reporting.






40. No impracticality exception for error corrections.






41. No requirement for explicitly stating following US GAAP.






42. Unusual in nature and infrequence in occurrence and material.






43. May not be capitalized.






44. Cost method or legal (par) method.






45. When the direct method is used - entities are required to present a reconciliation of net income to net cash flows from operating activities.






46. Revaluation is not permitted.






47. Functional currency is the currency of the entity's primary economic environment. Local currency is functional currency when foreign operations are relatively self-contained within that country.






48. No classification






49. Asset not required to be remeasures - but does get tested for impairment once classified as held-for-sale






50. FASB has not yet issued a pronouncement on convergence with IASB.