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. 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






2. 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 : (






3. Revaluation is not permitted.






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






5. 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






6. No impracticality exception for error corrections.






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






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






9. 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.






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






11. 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.






12. May not be capitalized.






13. Enacted tax rate only.






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






15. Slight variation from year-end reporting.






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






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






18. 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






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






20. 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).






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






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






23. 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.






24. 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.






25. Lower of cost or market.






26. 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.






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. Unusual in nature and infrequence in occurrence and material.






29. 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.






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






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






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






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






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






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






36. 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.






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






39. 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






40. 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.






41. No requirement for explicitly stating following US GAAP.






42. 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






43. Segment profit or loss - assets.






44. No classification






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






46. 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


47. Percentage of completion and completed contract method allowed.






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






49. 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






50. Enacted tax rate only.