Accounting 231 Question and answers
100% correct 2025/2026
Although the presentation formats for the balance sheet and statement of cash flows are similar under
IFRS and U.S GAAP, IFRS requires far more extensive disclosure. - correct answer ✔False
One Significant difference between a balance sheet prepared using IFRS rather than US GAAP is that
long-term tangible assets may be reported at fair value rather than historical cost. - correct answer
✔True
Both IFRS and US GAAP require that specific items be reported on the balance sheet. - correct answer
✔False
Both IFRS and U.S GAAP require current assets to be listed first on the balance sheet - correct answer
✔False
Which of the following statements about IFRS and US GAAP accounting and reporting requirements for
the balance sheet is not corrrect - correct answer ✔Both IFRS and US GAAP require that property, plant
and equipment be reported at historical cost on the balance sheet.
Franco Co uses IFRS and owns property, plant and equipment with a historical cost of 5,000,000. At
12/31/13 the company reported valuation reserve of 856500. At 12/31/14, the ppe was appraised at
5525000. The ppe will be reported on the 12/31/14 statement of financial position at - correct answer
✔5525000
Franco co uses IFRS and owns ppe with a historical cost of 5000000. At 12/31/13, the company reported
a valuation reserve of 8565000. At 12/31/14 the ppe was appraised at 5525000. The valuation reserve at
12/31/14 will be reported at - correct answer ✔9090000 in the equity section of the statement of
Financial position
, Similarities between IFRS and US GAAP requirements for balance sheet presentation include all of the
following - correct answer ✔Both require disclosure of significant accounting policies, both require the
preparation of financial statements annually, and both generally require the use of the current/non-
current classification for both assets and liabilities.
The order to present current assets is - correct answer ✔Cash, accounts receivable, inventories, and
prepaid items
The balance sheet is useful for analyzing - correct answer ✔Financial flexibility, liquidity, solvency
The balance sheet contributes to financial reporting by providing a basis for all of the following - correct
answer ✔Evaluating the capital structure of the enterprise, assessing the liquidity and financial
flexibility of the enterprise and computing rates of return.
Trading installment receivables normally collectible in 18 months. - correct answer ✔Current asset
Under IFRS, current assets are listed in - correct answer ✔The reverse order of liquidity
Under IFRS, which of the following current assets will be listed last in a statement of financial position -
correct answer ✔Cash
Limitation of the balance sheet - correct answer ✔Current fair value isn't reported, many items that are
of financial value are omitted, judgements and estimates are used.
Balance sheet info is useful for - correct answer ✔evaluating capital structure, assessing future cash
flows, computing rates of return.
Balance sheet if useful for - correct answer ✔Evaluating a company's liquidity, evaluating a company's
financial flexibility, and assessing a company's risk.
100% correct 2025/2026
Although the presentation formats for the balance sheet and statement of cash flows are similar under
IFRS and U.S GAAP, IFRS requires far more extensive disclosure. - correct answer ✔False
One Significant difference between a balance sheet prepared using IFRS rather than US GAAP is that
long-term tangible assets may be reported at fair value rather than historical cost. - correct answer
✔True
Both IFRS and US GAAP require that specific items be reported on the balance sheet. - correct answer
✔False
Both IFRS and U.S GAAP require current assets to be listed first on the balance sheet - correct answer
✔False
Which of the following statements about IFRS and US GAAP accounting and reporting requirements for
the balance sheet is not corrrect - correct answer ✔Both IFRS and US GAAP require that property, plant
and equipment be reported at historical cost on the balance sheet.
Franco Co uses IFRS and owns property, plant and equipment with a historical cost of 5,000,000. At
12/31/13 the company reported valuation reserve of 856500. At 12/31/14, the ppe was appraised at
5525000. The ppe will be reported on the 12/31/14 statement of financial position at - correct answer
✔5525000
Franco co uses IFRS and owns ppe with a historical cost of 5000000. At 12/31/13, the company reported
a valuation reserve of 8565000. At 12/31/14 the ppe was appraised at 5525000. The valuation reserve at
12/31/14 will be reported at - correct answer ✔9090000 in the equity section of the statement of
Financial position
, Similarities between IFRS and US GAAP requirements for balance sheet presentation include all of the
following - correct answer ✔Both require disclosure of significant accounting policies, both require the
preparation of financial statements annually, and both generally require the use of the current/non-
current classification for both assets and liabilities.
The order to present current assets is - correct answer ✔Cash, accounts receivable, inventories, and
prepaid items
The balance sheet is useful for analyzing - correct answer ✔Financial flexibility, liquidity, solvency
The balance sheet contributes to financial reporting by providing a basis for all of the following - correct
answer ✔Evaluating the capital structure of the enterprise, assessing the liquidity and financial
flexibility of the enterprise and computing rates of return.
Trading installment receivables normally collectible in 18 months. - correct answer ✔Current asset
Under IFRS, current assets are listed in - correct answer ✔The reverse order of liquidity
Under IFRS, which of the following current assets will be listed last in a statement of financial position -
correct answer ✔Cash
Limitation of the balance sheet - correct answer ✔Current fair value isn't reported, many items that are
of financial value are omitted, judgements and estimates are used.
Balance sheet info is useful for - correct answer ✔evaluating capital structure, assessing future cash
flows, computing rates of return.
Balance sheet if useful for - correct answer ✔Evaluating a company's liquidity, evaluating a company's
financial flexibility, and assessing a company's risk.
