,1| P a g enw nw nw nw
ADVANCED ACCOUNTING IN CANADA, 1ST CANADIAN EDITION BY nw nw nw nw nw nw nw nw
NATHALIE JOHNSTONE AND KRISTIE DEWALD TEST BANK|\ FULL Tnw nw nw nw nw nw nw nw
EST BANK WITH ALL CHAPTERS INCLUDED|| LATEST AND COMPLET
nw nw nw nw nw nw nw nw
E UPDATE 2025 WITH VERIFIED SOLUTIONS|| GUARANTEED A+
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Chapter 01: Introduction to Advanced Financial Accounting
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1.1 Describe the accounting standards used in Canada and how they apply
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to different reporting entities.
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1) A private company in Canada that is closely held, has no debt, and wants
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to simplify the accounting process is most likely to report under which part of
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the CPA Canada Handbook?
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A) Part II — Accounting Standards for Private Enterprises (ASPE)
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B) Part IV — Accounting Standards for Pensions
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C) Part I — International Financial Reporting Standards (IFRS)
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D) Part III — Accounting Standards for Not-for-Profit Organizations
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ANSWER_ A nw
Diff: 1 nw Type: MC nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
nw nw nw nw nw nw nw nw nw nw nw
w they apply to different reporting entities.
nw nw nw nw nw nw
2) In Canada, a private company has the choice to report under International
nw nw nw nw nw nw nw nw nw nw nw
Financial Reporting Standards (IFRS) or Accounting Standards for Private Ent
nw nw nw nw nw nw nw nw nw nw
erprises (ASPE). Describe why the CPA Canada Handbook provides the option f
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or private enterprises?
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,2| P a g enw nw nw nw
ANSWER_ IFRS is meant to create consistency and comparability in internation
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al markets. One of the limitations of IFRS is the complexity of reporting for eq
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uity investments that are meant to provide information to shareholders for decisi
nw nw nw nw nw nw nw nw nw nw nw
on-
making purposes. Many private companies are held by a small group of shareh
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olders who are often involved in the running of the business or have access to t
nw nw nw nw nw nw nw nw nw nw nw nw nw nw nw
hat information. As a result, the cost of applying more complex accounting poli
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cies outweighs the benefit of the information provided to this closely held grou
nw nw nw nw nw nw nw nw nw nw nw nw
p of shareholders. To address this, the Accounting
nw nw nw nw nw nw nw
Standards Board developed the Accounting Standards for Private Enterprises to
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meet the needs of private
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enterprises. Private enterprises have the option to adopt IFRS or ASPE dependin
nw nw nw nw nw nw nw nw nw nw nw
g on the needs of the financial statement users.
nw nw nw nw nw nw nw nw
Diff: 2 nw Type: ES nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
nw nw nw nw nw nw nw nw nw nw nw
w they apply to different reporting entities.
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3) What are the four parts of the CPA Canada Handbook —
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Accounting and which entities are they applicable to?
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ANSWER_ The four parts are: n w nw nw nw
• Part I — International Financial Reporting Standards (IFRS) —
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applicable to publicly accountable, private, or not-for-profit entities.
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• Part II — nw nw
Accounting Standards for Private Enterprises (ASPE) —
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applicable to private entities.
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• Part III — Accounting Standards for Not-for-
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Profit Organizations — applicable to not-for-profit entities.
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• Part IV — Accounting Standards for Pension Plans —
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applicable to pension plans.
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, 3| P a g e
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Diff: 1 nw Type: ES nw
Taxonomy Category: Remembering nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
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w they apply to different reporting entities.
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1.2 Discuss the conceptual framework for financial reporting and the gener
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al purpose of financial reporting.
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1) In 2011, Canada adopted International Financial Reporting Standards (IFRS) f
nw nw nw nw nw nw nw nw nw nw
or publicly accountable enterprises. Explain the rationale for adopting IFRS in C
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anada.
ANSWER_ As the global economy expanded, the Accounting Standards Board
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(AcSB) chose to adopt IFRS in Canada to improve consistency and comparabilit
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y in the international capital markets.
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Diff: 1 nw Type: ES nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.2 Discuss the conceptual framework for financial reporting
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and the general purpose of financial reporting.
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1.3 Define and identify strategic and non- nw nw nw nw nw
strategic intercorporate investments made by reporting entities.
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1) Laliberte Products Ltd. (LPL), a public company, made several equi
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ty investments in the current year.
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Which of the following investments would most likely be classified as an associ
nw nw nw nw nw nw nw nw nw nw nw nw
ate in LPL's financial statements?
nw nw nw nw
ADVANCED ACCOUNTING IN CANADA, 1ST CANADIAN EDITION BY nw nw nw nw nw nw nw nw
NATHALIE JOHNSTONE AND KRISTIE DEWALD TEST BANK|\ FULL Tnw nw nw nw nw nw nw nw
EST BANK WITH ALL CHAPTERS INCLUDED|| LATEST AND COMPLET
nw nw nw nw nw nw nw nw
E UPDATE 2025 WITH VERIFIED SOLUTIONS|| GUARANTEED A+
nw nw nw nw nw nw nw
Chapter 01: Introduction to Advanced Financial Accounting
nw n w nw nw nw nw
1.1 Describe the accounting standards used in Canada and how they apply
nw nw nw nw nw nw nw nw nw nw nw
to different reporting entities.
nw nw nw
1) A private company in Canada that is closely held, has no debt, and wants
nw nw nw nw nw nw nw nw nw nw nw nw nw
to simplify the accounting process is most likely to report under which part of
nw nw nw nw nw nw nw nw nw nw nw nw nw nw
the CPA Canada Handbook?
nw nw nw nw
A) Part II — Accounting Standards for Private Enterprises (ASPE)
nw nw nw nw nw nw nw nw
B) Part IV — Accounting Standards for Pensions
nw nw nw nw nw nw
C) Part I — International Financial Reporting Standards (IFRS)
nw nw nw nw nw nw nw
D) Part III — Accounting Standards for Not-for-Profit Organizations
nw nw nw nw nw nw nw
ANSWER_ A nw
Diff: 1 nw Type: MC nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
nw nw nw nw nw nw nw nw nw nw nw
w they apply to different reporting entities.
nw nw nw nw nw nw
2) In Canada, a private company has the choice to report under International
nw nw nw nw nw nw nw nw nw nw nw
Financial Reporting Standards (IFRS) or Accounting Standards for Private Ent
nw nw nw nw nw nw nw nw nw nw
erprises (ASPE). Describe why the CPA Canada Handbook provides the option f
nw nw nw nw nw nw nw nw nw nw nw
or private enterprises?
nw nw
,2| P a g enw nw nw nw
ANSWER_ IFRS is meant to create consistency and comparability in internation
nw nw nw nw nw nw nw nw nw nw
al markets. One of the limitations of IFRS is the complexity of reporting for eq
nw nw nw nw nw nw nw nw nw nw nw nw nw nw
uity investments that are meant to provide information to shareholders for decisi
nw nw nw nw nw nw nw nw nw nw nw
on-
making purposes. Many private companies are held by a small group of shareh
nw nw nw nw nw nw nw nw nw nw nw nw nw
olders who are often involved in the running of the business or have access to t
nw nw nw nw nw nw nw nw nw nw nw nw nw nw nw
hat information. As a result, the cost of applying more complex accounting poli
nw nw nw nw nw nw nw nw nw nw nw nw
cies outweighs the benefit of the information provided to this closely held grou
nw nw nw nw nw nw nw nw nw nw nw nw
p of shareholders. To address this, the Accounting
nw nw nw nw nw nw nw
Standards Board developed the Accounting Standards for Private Enterprises to
nw nw nw nw nw nw nw nw nw nw
meet the needs of private
nw nw nw nw
enterprises. Private enterprises have the option to adopt IFRS or ASPE dependin
nw nw nw nw nw nw nw nw nw nw nw
g on the needs of the financial statement users.
nw nw nw nw nw nw nw nw
Diff: 2 nw Type: ES nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
nw nw nw nw nw nw nw nw nw nw nw
w they apply to different reporting entities.
nw nw nw nw nw nw
3) What are the four parts of the CPA Canada Handbook —
nw nw nw nw nw nw nw nw nw nw
Accounting and which entities are they applicable to?
nw nw nw nw nw nw nw nw
ANSWER_ The four parts are: n w nw nw nw
• Part I — International Financial Reporting Standards (IFRS) —
nw nw nw nw nw nw nw nw
applicable to publicly accountable, private, or not-for-profit entities.
nw nw nw nw nw nw nw nw
• Part II — nw nw
Accounting Standards for Private Enterprises (ASPE) —
nw nw nw nw nw nw nw
applicable to private entities.
nw nw nw nw
• Part III — Accounting Standards for Not-for-
nw nw nw nw nw nw
Profit Organizations — applicable to not-for-profit entities.
nw nw nw nw nw nw
• Part IV — Accounting Standards for Pension Plans —
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applicable to pension plans.
nw nw nw nw
, 3| P a g e
nw nw nw nw
Diff: 1 nw Type: ES nw
Taxonomy Category: Remembering nw n w
Learning Outcome: 1.1 Describe the accounting standards used in Canada and ho
nw nw nw nw nw nw nw nw nw nw nw
w they apply to different reporting entities.
nw nw nw nw nw nw
1.2 Discuss the conceptual framework for financial reporting and the gener
nw nw nw nw nw nw nw nw nw
al purpose of financial reporting.
nw nw nw nw
1) In 2011, Canada adopted International Financial Reporting Standards (IFRS) f
nw nw nw nw nw nw nw nw nw nw
or publicly accountable enterprises. Explain the rationale for adopting IFRS in C
nw nw nw nw nw nw nw nw nw nw nw
anada.
ANSWER_ As the global economy expanded, the Accounting Standards Board
nw nw nw nw nw nw nw nw nw n
(AcSB) chose to adopt IFRS in Canada to improve consistency and comparabilit
w nw nw nw nw nw nw nw nw nw nw nw
y in the international capital markets.
nw nw nw nw nw
Diff: 1 nw Type: ES nw
Taxonomy Category: Understanding nw n w
Learning Outcome: 1.2 Discuss the conceptual framework for financial reporting
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and the general purpose of financial reporting.
w nw nw nw nw nw nw
1.3 Define and identify strategic and non- nw nw nw nw nw
strategic intercorporate investments made by reporting entities.
nw nw nw nw nw nw
1) Laliberte Products Ltd. (LPL), a public company, made several equi
nw nw nw nw nw nw nw nw nw
ty investments in the current year.
nw nw nw nw nw
Which of the following investments would most likely be classified as an associ
nw nw nw nw nw nw nw nw nw nw nw nw
ate in LPL's financial statements?
nw nw nw nw
