Test Bank for Modern Advanced Accounting In Canada 10th Edition B y Hilton Murray, Herauf Darrell Chapter 1 -12 Answers Are At the End of Each Chapter Chapter 1 Student name:__________ 1) In which of the following situations would professional judgment N OT be required in decision making?
1) ______ A) Recognition of revenue. B) The making of accounting estimates. C) Disclosure of information in the notes to the financial statements. D) Use of IFRS or ASPE for publicly traded companies in Canada. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framework for financial reporting. Topic : 01 -02 Professional Judgment 2) Which of the following statemen ts pertaining to generally accepted accounting principles (GAAP) is INCORRECT?
2) ______
A) The process of developing GAAP is political. B) If a proposal for a new financial reporting is not accepted by users, it is unlikely to become part of GAAP. C) If an entity that follows GAAP encounters transactions that are not addressed by the CPA Canada Handbook, it is permitted to adopt accounting practices that are consistent with industry practice. D) Publicly traded companies are required to submit financial st atements that comply with GAAP to the securities commissions under which they are registered. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framewor k for financial reporting. Topic : 01 -01 The Conceptual Framework for Financial Reporting 3) Which of the following examples does NOT demonstrate the interrelationships of financial statement elements?
3) ______ A) A sale on account will increase asset s and equity. B) Depreciation of equipment will decrease assets and decrease equity. C) The payment of a payable will decrease liabilities and increase assets. D) The contribution of capital will increase an asset and increase equity. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framework for financial reporting. Topic : 01 -01 The Conceptual Framework for Financial Reporting 4) Which of the foll owing statements pertaining to GAAP for publicly accountable enterprises (PAEs) is correct?
4) ______
A) PAEs include not -for-profit organizations. B) Commencing in 2011, most Canadian PAEs are required to elect to report under either IFRS or ASPE on a pr ospective basis. C) PAEs include an entity, that as one of its primary businesses, holds assets in a fiduciary capacity for a broad group of outsiders. D) CPA Canada and the Financial Accounting Standards Board (FASB) harmonized the accounting standards of the United States and Canada for PAEs beginning in 1998. Question Details Accessibility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Topic : 01 -04 GAAP for Publicily Accountabl e Enterprises Bloom's : Remember Difficulty : Easy 5) Which of the following statements pertaining to private enterprises (PEs) is INCORRECT?
5) _____
A) PEs may adopt either ASPE or IFRS but once a set of standards is adopted, the PEs are not permitted to apply some standards from ASPE and others from IFRS. B) The accounting standards for a PE are included in a separate part of the CPA Canada Handbook. C) PEs with annual revenues over $10,000,000, are required to report under IFRS. D) A PE is a profit -oriented enterprise that has none of its issued and outstanding financial instruments traded in a public market and does not hold assets in a fiduciary capacity for a broad group of outsiders as one of its primary businesses. Question Details Accessibility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Bloom's : Remember Difficulty : Easy Topic : 01 -05 GAAP for Private Enterprises 6) Which of the following organizations are req uired to use only the IFRS (Part I) in Canada?
6) ______
A) All corporations, government agencies and private companies. B) Public companies and private companies whose shareholders' equity is in excess of $500,000,000 at any particular year -end. C) Publi c companies, private companies and not -for-profit organizations. D) Government business enterprises. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -03 Identify some of the differences betw een IFRS and ASPE. Topic : 01 -08 GAPP for Government and Other Government Organizations 7) Which of the following statements pertaining to Not -for-Profit -Organizations (NFPO) is INCORRECT?
7) ______ A) A government NFPO has the choice to follow either th e 4200 series of the CPA Canada Public Sector Accounting (PSA) Handbook or the PSA Handbook without the 4200 series. B) A non -government NFPO has a choice to follow Part I (IFRS) or Part III of the CPA Canada Handbook . C) A government NFPO has a choice to follow Part I (IFRS) of the CPA Canada Handbook or the CPA Canada Public Sector Accounting Handbook . D) A non -government NFPO that applies Part III of the CPA Canada Handbook will also apply relevant sections from Part II (ASPE) of the CPA Canada Handbook . Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -03 Identify some of the differences between IFRS and ASPE. Topic : 01 -07 GAAP for Not -For-Profit Organizations 8) For which of the follo wing types of organizations does the CPA Canada Handbook NOT provide specific accounting standards?
8) ______ A) Publicly accountable enterprises. B) Private enterprises. C) Not -for-profit organizations. D) Proprietorships. Question Details Accessi bility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Topic : 01 -04 GAAP for Publicily Accountable Enterprises Bloom's : Remember Difficulty : Easy Topic : 01 -05 GAAP for Private Enterprises Topic : 01 -06 Differences Between IFRS and ASPE Learning Objective : 01 -03 Identify some of the differences between IFRS and ASPE. Topic : 01 -07 GAAP for Not -For-Profit Organizations 9) Which of the following is NOT a reason why a Canadian private company would elect to report under IFRS?
9) ______
1) ______ A) Recognition of revenue. B) The making of accounting estimates. C) Disclosure of information in the notes to the financial statements. D) Use of IFRS or ASPE for publicly traded companies in Canada. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framework for financial reporting. Topic : 01 -02 Professional Judgment 2) Which of the following statemen ts pertaining to generally accepted accounting principles (GAAP) is INCORRECT?
2) ______
A) The process of developing GAAP is political. B) If a proposal for a new financial reporting is not accepted by users, it is unlikely to become part of GAAP. C) If an entity that follows GAAP encounters transactions that are not addressed by the CPA Canada Handbook, it is permitted to adopt accounting practices that are consistent with industry practice. D) Publicly traded companies are required to submit financial st atements that comply with GAAP to the securities commissions under which they are registered. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framewor k for financial reporting. Topic : 01 -01 The Conceptual Framework for Financial Reporting 3) Which of the following examples does NOT demonstrate the interrelationships of financial statement elements?
3) ______ A) A sale on account will increase asset s and equity. B) Depreciation of equipment will decrease assets and decrease equity. C) The payment of a payable will decrease liabilities and increase assets. D) The contribution of capital will increase an asset and increase equity. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -01 Describe and apply the conceptual framework for financial reporting. Topic : 01 -01 The Conceptual Framework for Financial Reporting 4) Which of the foll owing statements pertaining to GAAP for publicly accountable enterprises (PAEs) is correct?
4) ______
A) PAEs include not -for-profit organizations. B) Commencing in 2011, most Canadian PAEs are required to elect to report under either IFRS or ASPE on a pr ospective basis. C) PAEs include an entity, that as one of its primary businesses, holds assets in a fiduciary capacity for a broad group of outsiders. D) CPA Canada and the Financial Accounting Standards Board (FASB) harmonized the accounting standards of the United States and Canada for PAEs beginning in 1998. Question Details Accessibility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Topic : 01 -04 GAAP for Publicily Accountabl e Enterprises Bloom's : Remember Difficulty : Easy 5) Which of the following statements pertaining to private enterprises (PEs) is INCORRECT?
5) _____
A) PEs may adopt either ASPE or IFRS but once a set of standards is adopted, the PEs are not permitted to apply some standards from ASPE and others from IFRS. B) The accounting standards for a PE are included in a separate part of the CPA Canada Handbook. C) PEs with annual revenues over $10,000,000, are required to report under IFRS. D) A PE is a profit -oriented enterprise that has none of its issued and outstanding financial instruments traded in a public market and does not hold assets in a fiduciary capacity for a broad group of outsiders as one of its primary businesses. Question Details Accessibility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Bloom's : Remember Difficulty : Easy Topic : 01 -05 GAAP for Private Enterprises 6) Which of the following organizations are req uired to use only the IFRS (Part I) in Canada?
6) ______
A) All corporations, government agencies and private companies. B) Public companies and private companies whose shareholders' equity is in excess of $500,000,000 at any particular year -end. C) Publi c companies, private companies and not -for-profit organizations. D) Government business enterprises. Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -03 Identify some of the differences betw een IFRS and ASPE. Topic : 01 -08 GAPP for Government and Other Government Organizations 7) Which of the following statements pertaining to Not -for-Profit -Organizations (NFPO) is INCORRECT?
7) ______ A) A government NFPO has the choice to follow either th e 4200 series of the CPA Canada Public Sector Accounting (PSA) Handbook or the PSA Handbook without the 4200 series. B) A non -government NFPO has a choice to follow Part I (IFRS) or Part III of the CPA Canada Handbook . C) A government NFPO has a choice to follow Part I (IFRS) of the CPA Canada Handbook or the CPA Canada Public Sector Accounting Handbook . D) A non -government NFPO that applies Part III of the CPA Canada Handbook will also apply relevant sections from Part II (ASPE) of the CPA Canada Handbook . Question Details Accessibility : Keyboard Navigation Bloom's : Remember Difficulty : Easy Learning Objective : 01 -03 Identify some of the differences between IFRS and ASPE. Topic : 01 -07 GAAP for Not -For-Profit Organizations 8) For which of the follo wing types of organizations does the CPA Canada Handbook NOT provide specific accounting standards?
8) ______ A) Publicly accountable enterprises. B) Private enterprises. C) Not -for-profit organizations. D) Proprietorships. Question Details Accessi bility : Keyboard Navigation Learning Objective : 01 -02 Describe how accounting standards in Canada are tailored to different type Topic : 01 -04 GAAP for Publicily Accountable Enterprises Bloom's : Remember Difficulty : Easy Topic : 01 -05 GAAP for Private Enterprises Topic : 01 -06 Differences Between IFRS and ASPE Learning Objective : 01 -03 Identify some of the differences between IFRS and ASPE. Topic : 01 -07 GAAP for Not -For-Profit Organizations 9) Which of the following is NOT a reason why a Canadian private company would elect to report under IFRS?
9) ______
