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






3. 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.






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






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. No impracticality exception for error corrections.






7. Cost method or legal (par) method.






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






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






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






11. 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.






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






13. All gains and losses included in OCI






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






15. 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.






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






17. Revaluation is not permitted.






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






19. 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






20. 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.






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






22. Percentage of completion and completed contract method allowed.






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






24. No classification






25. May not be capitalized.






26. 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.






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






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






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






30. 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.






31. 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.






32. No requirement for explicitly stating following US GAAP.






33. 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.






34. Slight variation from year-end reporting.






35. 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.






36. Lower of cost or market.






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






38. 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.






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






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






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






42. Segment profit or loss - assets.






43. 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






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






45. 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.






46. 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






47. 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.






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






49. 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.






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