TEST BANK For
Modern Advanced Accounting In Canada
10th Edition
By Darrell Herauf, Chima Mbagwu
Verified Chapter's 1 - 12 | Complete
1-1
,TABLE OF CONTENTS
CHAPTER 1 Conceptual and Case Analysis Frameworks for Financial Reporting
CHAPTER 2 Investments in Equity Securities
CHAPTER 3 Business Combinations
CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries
CHAPTER 5 Consolidation Subsequent to Acquisition Date
CHAPTER 6 Intercompany Inventory and Land Profits
CHAPTER 7 (A) Intercompany Profits in Depreciable Assets (B) Intercompany Bondholdings
CHAPTER 8 Consolidated Cash Flows and Changes in Ownership
CHAPTER 9 Other Consolidation Reporting Issues
CHAPTER 10 Foreign Currency Transactions
CHAPTER 11 Translation and Consolidation of Foreign Operations
CHAPTER 12 Accounting for Not-for-Profit and Public Sector Organizations
1-2
, Chapter 01
Conceptual and Case Analysis Frameworks for Financial Reporting
Multiple Choice Questions
1. Which of the following would NOT be a reason to obtain a greater understanding of
accounting practices in other nations?
A. Financial results are disclosed in different currencies.
B. One needs to be aware of differing disclosure requirements from nation to nation, as this
impacts the preparation of financial statements.
C. Income-smoothing may have affected a foreign subsidiary's results; such smoothing
practices are not permitted in North America.
D. Departures from the historical cost principle may be possible in other nations.
Accessibility: Keyboard Navigation
Blooms: 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
2. Which of the following would be most affected by financial statements being prepared
under different accounting principles?
A. Reduced comparability.
B. Reduced reliability.
C. Increased complexity.
D. Inaccurate asset valuations.
Accessibility: Keyboard Navigation
Blooms: 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
1-3
, 3. ThewsCPAwsCanadawsHandbookws-
wsAccountingwsiswsthewshandbookwsofwsCanadianwsaccountingwsstandards.wsWhywsdowsco
mpanieswsinwsCanadawsensurewsthatwstheirwsfinancialwsreportingwsiswsconsistentwswithwsCa
nadianwsGAAP?
A. Theirwsbankwsrequireswsthemwstowsdowsso.
B. Theirwsauditorswsrequirewsthemwstowsdowsso.
C. ReportingwsunderwsthewsCPAwsCanadawsHandbookws-
wsAccountingwsiswsrequiredwsbywspublicwscompanies'wsboardswsofwsdirectors.
D. CompliancewswithwsthewsCPAwsCanadawsHandbookws-
wsAccountingwspronouncementswsiswsusuallywsrequiredwsbywsmanywslegalwsstatutes.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
01wsDescribewsandwsapplywsthewsconceptualwsframeworkwsforwsfinancialwsreporting.w s Topic:w
s01-01wsThewsConceptualwsFrameworkwsforwsFinancialwsReporting
4. WhichwsdecisionwshaswsCanadawsmadewswithwsrespectwstowsfinancialwsreporting
wsforwsprivatewsenterprises?
A. TowsadoptwsthewsIFRSwsstandardswsforwssmallwsandwsmedium-sizedwsenterprises.
B. Towsretainwsthewscurrentwsstandards.
C. TowslookwstowsUSwsGAAPwsforwsstandards.
D. Towsdevelopwsandwsmaintainwsitswsownwsstandardswsforwsprivatewsenterprises.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
02wsDescribewshowwsaccountingwsstandardswsinwsCanadawsarewstailoredwstowsdifferentwstypeswsofwsorganizations
.w s Topic:ws01-05wsGAAPwsforwsPrivatewsEnterprises
5. Startingwsinws2011,wswhatwsiswsthewsdefinitionwsofwsawsprivatewsenterprisews(PE)wsunderwsCanadianwsGAA
?
A. Awscorporationwsthatwshaswsnowspublicwsshareholders.
B. Awscorporationwsthatwshaswslesswsthanws500wsshareholderswsandwsiswsnotwslistedwsonwsawsstockwsexchange
C. Awscorporationwswhichwsiswsnotwsprofitwsoriented.
D. Awsprofitwsorientedwsenterprisewsthatwshaswsnonewsofwsitswsissuedwsandwsoutstandingwsfi
nancialwsinstrumentswstradedwsinwsawspublicwsmarketwsandwsdoeswsnotwsholdwsassetswsinwsa
wsfiduciarywscapacitywsforwsawsbroadwsgroupwsofwsoutsiderswsaswsonewsofwsitswsprimarywsb
usinesses.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
02wsDescribewshowwsaccountingwsstandardswsinwsCanadawsarewstailoredwstowsdifferentwstypeswsofwsorganizations
1-4
Modern Advanced Accounting In Canada
10th Edition
By Darrell Herauf, Chima Mbagwu
Verified Chapter's 1 - 12 | Complete
1-1
,TABLE OF CONTENTS
CHAPTER 1 Conceptual and Case Analysis Frameworks for Financial Reporting
CHAPTER 2 Investments in Equity Securities
CHAPTER 3 Business Combinations
CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries
CHAPTER 5 Consolidation Subsequent to Acquisition Date
CHAPTER 6 Intercompany Inventory and Land Profits
CHAPTER 7 (A) Intercompany Profits in Depreciable Assets (B) Intercompany Bondholdings
CHAPTER 8 Consolidated Cash Flows and Changes in Ownership
CHAPTER 9 Other Consolidation Reporting Issues
CHAPTER 10 Foreign Currency Transactions
CHAPTER 11 Translation and Consolidation of Foreign Operations
CHAPTER 12 Accounting for Not-for-Profit and Public Sector Organizations
1-2
, Chapter 01
Conceptual and Case Analysis Frameworks for Financial Reporting
Multiple Choice Questions
1. Which of the following would NOT be a reason to obtain a greater understanding of
accounting practices in other nations?
A. Financial results are disclosed in different currencies.
B. One needs to be aware of differing disclosure requirements from nation to nation, as this
impacts the preparation of financial statements.
C. Income-smoothing may have affected a foreign subsidiary's results; such smoothing
practices are not permitted in North America.
D. Departures from the historical cost principle may be possible in other nations.
Accessibility: Keyboard Navigation
Blooms: 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
2. Which of the following would be most affected by financial statements being prepared
under different accounting principles?
A. Reduced comparability.
B. Reduced reliability.
C. Increased complexity.
D. Inaccurate asset valuations.
Accessibility: Keyboard Navigation
Blooms: 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
1-3
, 3. ThewsCPAwsCanadawsHandbookws-
wsAccountingwsiswsthewshandbookwsofwsCanadianwsaccountingwsstandards.wsWhywsdowsco
mpanieswsinwsCanadawsensurewsthatwstheirwsfinancialwsreportingwsiswsconsistentwswithwsCa
nadianwsGAAP?
A. Theirwsbankwsrequireswsthemwstowsdowsso.
B. Theirwsauditorswsrequirewsthemwstowsdowsso.
C. ReportingwsunderwsthewsCPAwsCanadawsHandbookws-
wsAccountingwsiswsrequiredwsbywspublicwscompanies'wsboardswsofwsdirectors.
D. CompliancewswithwsthewsCPAwsCanadawsHandbookws-
wsAccountingwspronouncementswsiswsusuallywsrequiredwsbywsmanywslegalwsstatutes.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
01wsDescribewsandwsapplywsthewsconceptualwsframeworkwsforwsfinancialwsreporting.w s Topic:w
s01-01wsThewsConceptualwsFrameworkwsforwsFinancialwsReporting
4. WhichwsdecisionwshaswsCanadawsmadewswithwsrespectwstowsfinancialwsreporting
wsforwsprivatewsenterprises?
A. TowsadoptwsthewsIFRSwsstandardswsforwssmallwsandwsmedium-sizedwsenterprises.
B. Towsretainwsthewscurrentwsstandards.
C. TowslookwstowsUSwsGAAPwsforwsstandards.
D. Towsdevelopwsandwsmaintainwsitswsownwsstandardswsforwsprivatewsenterprises.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
02wsDescribewshowwsaccountingwsstandardswsinwsCanadawsarewstailoredwstowsdifferentwstypeswsofwsorganizations
.w s Topic:ws01-05wsGAAPwsforwsPrivatewsEnterprises
5. Startingwsinws2011,wswhatwsiswsthewsdefinitionwsofwsawsprivatewsenterprisews(PE)wsunderwsCanadianwsGAA
?
A. Awscorporationwsthatwshaswsnowspublicwsshareholders.
B. Awscorporationwsthatwshaswslesswsthanws500wsshareholderswsandwsiswsnotwslistedwsonwsawsstockwsexchange
C. Awscorporationwswhichwsiswsnotwsprofitwsoriented.
D. Awsprofitwsorientedwsenterprisewsthatwshaswsnonewsofwsitswsissuedwsandwsoutstandingwsfi
nancialwsinstrumentswstradedwsinwsawspublicwsmarketwsandwsdoeswsnotwsholdwsassetswsinwsa
wsfiduciarywscapacitywsforwsawsbroadwsgroupwsofwsoutsiderswsaswsonewsofwsitswsprimarywsb
usinesses.
Accessibility:wsKeyboardwsNavigationw
s Blooms:wsRemember
Difficulty:wsEasy
LearningwsObjective:ws01-
02wsDescribewshowwsaccountingwsstandardswsinwsCanadawsarewstailoredwstowsdifferentwstypeswsofwsorganizations
1-4
