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. All gains and losses included in OCI






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. 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






4. 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.






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






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






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

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9. Cost method or legal (par) method.






10. Enacted tax rate only.






11. 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 : (






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






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






14. 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.






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






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






17. 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.






18. 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.






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






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






21. 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






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






23. 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.






24. 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.






25. 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






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






27. May not be capitalized.






28. Revaluation is not permitted.






29. 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






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






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






32. Enacted tax rate only.






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






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






35. No requirement for explicitly stating following US GAAP.






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






37. 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






38. 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.






39. Percentage of completion and completed contract method allowed.






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






41. 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






42. 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.






43. 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.






44. 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.






45. 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.






46. Lower of cost or market.






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






48. Segment profit or loss - assets.






49. 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.






50. No classification