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 classification






2. 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.






3. 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.






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






5. Segment profit or loss - assets.






6. 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






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






8. 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.






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






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






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. 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.






13. Slight variation from year-end reporting.






14. Enacted tax rate only.






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






16. Revaluation is not permitted.






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






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






19. All gains and losses included in OCI






20. 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.






21. 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.






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

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23. 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






24. Lower of cost or market.






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. 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.






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






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






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






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






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






32. 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.






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






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






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






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






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. 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.






39. Cost method or legal (par) method.






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






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






42. 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.






43. No requirement for explicitly stating following US GAAP.






44. 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






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






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






47. Enacted tax rate only.






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






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






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