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. No requirement for explicitly stating following US GAAP.






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






3. Enacted tax rate only.






4. Slight variation from year-end reporting.






5. 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).






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






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






8. 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.






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






10. 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.






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






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






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






14. 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






15. Segment profit or loss - assets.






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






17. No impracticality exception for error corrections.






18. Enacted tax rate only.






19. Entities may elect the fair value option for recognized financial assets and financial liabilities. You cannot elect fair value on these: (1) VIE that is required to be consolidated (2) pension plan assets/liabilities (3) leased financial assets/liab






20. Interest and dividends received - interest paid and taxes paid are CFO. Dividends paid are classified as CFF.






21. 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






22. 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






23. 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.






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






25. 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.






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






27. 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.






28. 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.






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


30. 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.






31. 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






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. Percentage of completion and completed contract method allowed.






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






35. Classified as: (1) trading (2) available-for-sale (3) held-to-maturity






36. 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






37. 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






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






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






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






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






43. Revaluation is not permitted.






44. All gains and losses included in OCI






45. May not be capitalized.






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






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






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






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






50. 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.