CFA Level 1 Mock Exam C: Afternoon session
questions and answers 2025\2026 A+ Grade
Which of the following is most likely required to comply with the GIPS standards regarding input data?
Portfolio valuations must:
- correct answer use accrual accounting for all interest bearing investments
Li Chen, is a CFA candidate and an equity research analyst at an independent research firm. Chen is
contacted by Granite Technologies, Inc., to write an issuer-paid research report on the firm to increase
awareness of Granite's stock amongst the investment community. Which statement best represents
how Chen should respond to this assignment request? Chen should:
- correct answer negotiation a flat fee
her independence and objectivity would not be questioned as her fee would not be based on the results
of her research
In generating an estimate of a population parameter, a larger sample size is most likely to improve the
estimator's
- correct answer consistency
Equity return distributions are best described as being:
- correct answer leptokurtic
liquidity premium
- correct answer risk of loss relative to an investment's fair value if the investment needs to be
converted to cash quickly.
When testing the population mean, the use of a z-statistic is most appropriate when the:
- correct answer when the variance is known and the sample is normally distributed
, Two-tailed and one-tailed tests have which of the following characteristics in common?
- correct answer Significance levels are used to establish rejection points
Which type of triangle pattern most likely exhibits a horizontal trendline connecting the high prices?
- correct answer ascending
In the classification of currency regimes, a currency board system (CBS) most likely differs from a fixed-
rate parity system in that:
- correct answer the monetary authority within a CBS does not act as a traditional lender of last resort.
Under International Financial Reporting Standards (IFRS), which of the following is most likely one of the
general features underlying the preparation of financial statements?
- correct answer consistency
According to the International Financial Reporting Standards (IFRS), which of the following conditions
should be satisfied to report revenue from the sale of goods on the income statement?
- correct answer costs can be reliably measured
Other comprehensive income is least likely to include gains or losses on:
- correct answer the sale or disposal of discontinued operations(goes on bottom of IS, included in NI,
both other comp)
what is included in other comprehensive income?
- correct answer derivative contracts accounted for as hedges
the translation of foreign currency-denominated subsidiary financial statements
Under International Financial Reporting Standards (IFRS), which of the following is most commonly
classified as a non-current liability?
- correct answer deferred tax liability
The objective of general purpose financial reporting is best described as:
- correct answer facilitating resource allocation decisions by current and potential investors and
creditors
questions and answers 2025\2026 A+ Grade
Which of the following is most likely required to comply with the GIPS standards regarding input data?
Portfolio valuations must:
- correct answer use accrual accounting for all interest bearing investments
Li Chen, is a CFA candidate and an equity research analyst at an independent research firm. Chen is
contacted by Granite Technologies, Inc., to write an issuer-paid research report on the firm to increase
awareness of Granite's stock amongst the investment community. Which statement best represents
how Chen should respond to this assignment request? Chen should:
- correct answer negotiation a flat fee
her independence and objectivity would not be questioned as her fee would not be based on the results
of her research
In generating an estimate of a population parameter, a larger sample size is most likely to improve the
estimator's
- correct answer consistency
Equity return distributions are best described as being:
- correct answer leptokurtic
liquidity premium
- correct answer risk of loss relative to an investment's fair value if the investment needs to be
converted to cash quickly.
When testing the population mean, the use of a z-statistic is most appropriate when the:
- correct answer when the variance is known and the sample is normally distributed
, Two-tailed and one-tailed tests have which of the following characteristics in common?
- correct answer Significance levels are used to establish rejection points
Which type of triangle pattern most likely exhibits a horizontal trendline connecting the high prices?
- correct answer ascending
In the classification of currency regimes, a currency board system (CBS) most likely differs from a fixed-
rate parity system in that:
- correct answer the monetary authority within a CBS does not act as a traditional lender of last resort.
Under International Financial Reporting Standards (IFRS), which of the following is most likely one of the
general features underlying the preparation of financial statements?
- correct answer consistency
According to the International Financial Reporting Standards (IFRS), which of the following conditions
should be satisfied to report revenue from the sale of goods on the income statement?
- correct answer costs can be reliably measured
Other comprehensive income is least likely to include gains or losses on:
- correct answer the sale or disposal of discontinued operations(goes on bottom of IS, included in NI,
both other comp)
what is included in other comprehensive income?
- correct answer derivative contracts accounted for as hedges
the translation of foreign currency-denominated subsidiary financial statements
Under International Financial Reporting Standards (IFRS), which of the following is most commonly
classified as a non-current liability?
- correct answer deferred tax liability
The objective of general purpose financial reporting is best described as:
- correct answer facilitating resource allocation decisions by current and potential investors and
creditors
