Intermediate Accounting Volume 1 8th Edition by Beechy, Conrod & Farrell | Financial Accounting Study Textbook

Study Guide For:
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Intermediate Accounting Volume 1 8th Edition by
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Beechy, Conrod, Farrell & McLeay | Financial
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Accounting Review Questions & Answers | Exam Prep
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2026/2027 b

,Chapter 1 b




Studentname: b




1) The main purpose of financial accounting is to communicate useful financial information to
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b decision-makers both inside and outside of the business organization.
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⊚ true b




⊚ false b




2) The Canadian Business Corporations Act mandates that all incorporated companies in
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b Canada follow IFRS. b b




⊚ true b




⊚ false b




3) Private companies in Canada may choose between IFRS or ASPE.
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⊚ true b




⊚ false b




4) Canada has adapted its own pre-existing standards for public companies to IFRS, while the
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U.S has adopted IFRS completely.
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⊚ true b




⊚ false b




5) A disclosed basis of accounting (DBA) is acceptable if a company's financial statements are
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b prepared solely for internal use.
b b b b




⊚ true b




⊚ false b

,6) Only publicly traded companies in Canada are required to adopt IFRS.
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⊚ true
b




⊚ false
b




7) Earnings quality is said to be high when most of a company's earnings are the result of its
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b continuing operations. b




⊚ true b




⊚ false
b




8) Income tax deferral is illegal in Canada.
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⊚ true
b




⊚ false
b




9) In Canada, income for tax and accounting purposes may be different.
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⊚ true
b




⊚ false
b




10) External users of a company's financial statements may have conflicting objectives.
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⊚ true
b




⊚ false
b




11) In Canada, IFRS standards were essentially converged with Canadian GAAP.
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⊚ true
b




⊚ false
b




12) A company's functional currency is always the currency in which the financial statements are
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b presented.
⊚ true b




⊚ false
b

, 13) It is acceptable for publicly traded Canadian companies to report under US GAAP.
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⊚ true b




⊚ false b




14) In Canada, almost all equity financing for both public and private companies is done through
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b private placements. b




⊚ true b




⊚ false b




15) IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).
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⊚ true b




⊚ false b




16) Privately held for-profit enterprises with a fiduciary responsibility have a choice between
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b IFRS and ASPE. b b




⊚ true b




⊚ false b




17) Mutual fund companies, which may be privately held, are deemed to have a fiduciary
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b responsibility and must therefore comply with IFRS.
b b b b b b




⊚ true b




⊚ false b




18) Canadian companies must always present their financial results in Canadian dollars.
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⊚ true b




⊚ false b




19) Canadian corporations are prohibited from using U.S. GAAP.
b b b b b b b




⊚ true b




⊚ false b