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. Enacted tax rate only.






2. Characterized as having commercial substance and lacking commercial substance. Commercial substance (accounted for at fair value and all gains are recognized). Lacking commercial substance (gains are only recognized when boot is received). Losses are






3. 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






4. May not be capitalized.






5. 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.






6. 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






7. Remeasurement method must be used when a foreign subsidiary is operating in a highly inflationary environment.






8. 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.






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


10. Segment profit or loss - assets.






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






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






13. Enacted tax rate only.






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






15. 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 : (






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






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






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






19. Slight variation from year-end reporting.






20. Revaluation is not permitted.






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






22. (Balance sheet - income statement - SOCF) as of the most recent fiscal quarter and as of the end of the preceding fiscal year.






23. 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






24. No impracticality exception for error corrections.






25. Cost model: historical - accum. depr. = impairment






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






27. Research and development costs expensed - reported using the cost model only.






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






29. Valuation allowance is recognized when it is more likely than not that part or all of the deferred tax asset will not be realized.






30. Percentage of completion and completed contract method allowed.






31. Effective interest method is required - unless the straight-line method is not materially different from the effective interest method. Amortization is done over the contractual life of the bond.






32. If year-end differs by three months or less - parent can use the subsidiary's regular financial statements of a different period - but they must be significantly disclosed.






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






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






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






36. No classification






37. 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).






38. No requirement for explicitly stating following US GAAP.






39. Unrecognized prior service cost and unrecognized pension gains and losses are reported in AOCI. The pension benefit asset/liability is equal to the funded status of the pension plan.






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






41. 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






42. Either does not have equity investors with voting rights or lacks sufficient financial resources to support its activities. Primary beneficiary must consolidate the VIE. The primary beneficiary is the entity that has the power to direct the activitie






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






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






45. All gains and losses included in OCI






46. Comparative financial statements not required. SEC requires comparative financial statements (2 B/S - 3 other). Cumulative effect is an adjustment to beginning retained earnings to the earliest prior period presented.






47. 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.






48. Lower of cost or market.






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






50. Projection benefit obligation (PBO) is the defined benefit pension plan liability.