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 separate recognition is given to the conversion feature when convertible bonds are issued. Bonds are recorded in same manner as non-convertible bonds.






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






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






4. 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 : (






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






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






7. 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.






8. 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






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

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


10. 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.






11. Enacted tax rate only.






12. May not be capitalized.






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






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






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






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






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






18. 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.






19. 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






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






21. No requirement for explicitly stating following US GAAP.






22. Segment profit or loss - assets.






23. No classification






24. 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






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






26. Slight variation from year-end reporting.






27. 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






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






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






30. 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.






31. 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.






32. Cost method or legal (par) method.






33. Entities have two choices when accounting for gains and losses: (1) recognize on the income statement in period incurred (2) recognize in OCI in the period incurred and then amortize to pension expense using the corridor approach.






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






35. Enacted tax rate only.






36. 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.






37. 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.






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






39. 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.






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






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






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






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






44. 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.






45. 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.






46. 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






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






48. Percentage of completion and completed contract method allowed.






49. 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.






50. 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.