TEST BANK For Modern Advanced Accounting In Canada, 10th Edition By Darrell Herauf, Chima Mbagwu, Verified Chapters 1 - 12, Complete Newest Version

TEST BANK for Modern Advanced
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Accounting in Canada 10th Edition
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Hilton Murray,Herauf Darrell
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,TEST BANK for Modern Advanced Accounting in Canada 9th Edition Hilton
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Murray,Herauf Darrell
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Chapter
01Conceptual and Case Analysis Frameworks for Financial
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Reporting
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Multiple Choice Questions
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1. Which of the following would NOT be a reason to obtain a greater understanding
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ofaccounting practices in other nations?
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A. Financial results are disclosed in different currencies.
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B. One needs to be aware of differing disclosure requirements from nation to nation, as
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thisimpacts the preparation of financial statements.
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C. Income-smoothing may have affected a foreign subsidiary's results; such h h h h h h h h


smoothingpractices are not permitted in North America.
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D. Departures from the historical cost principle may be possible in other nations.
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Learning hObjective: h01-01 hDescribe hand happly hthe hconceptual hframework hfor hfinancial hreporting.
hTopic: h01-01 hThe hConceptual hFramework hfor h Financial hReporting




2. Which of the following would be most affected by financial statements being
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preparedunder different accounting principles?
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A. Reduced comparability. h


B. Reduced reliability. h


C. Increased complexity. h


D. Inaccurate asset valuations. h h




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Learning hObjective: h01-01 hDescribe hand happly hthe hconceptual hframework hfor hfinancial hreporting.
hTopic: h01-01 hThe hConceptual hFramework hfor h Financial hReporting




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,3. The CPA Canada Handbook - Accounting is the handbook of Canadian accounting
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standards. Why do companies in Canada ensure that their financial reporting is
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consistentwith Canadian GAAP?
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A. Their bank requires them to do so.
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B. Their auditors require them to do so.
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C. Reporting under the CPA Canada Handbook - Accounting is required by public
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companies'boards of directors.
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D. Compliance with the CPA Canada Handbook - Accounting pronouncements is
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usuallyrequired by many legal statutes.
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Learning hObjective: h01-01 hDescribe hand happly hthe hconceptual hframework hfor hfinancial hreporting.
hTopic: h01-01 hThe hConceptual hFramework hfor h Financial hReporting




4. Which decision has Canada made with respect to financial reporting for
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privateenterprises?
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A. To adopt the IFRS standards for small and medium-sized enterprises.
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B. To retain the current standards.
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C. To look to US GAAP for standards.
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D. To develop and maintain its own standards for private enterprises.
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Learning hObjective: h01-02 hDescribe hhow haccounting hstandards hin hCanada hare htailored hto hdifferent htypes hof
horganizations. hTopic: h01-05 hGAAP hfor h Private hEnterprises




5. Starting in 2011, what is the definition of a private enterprise (PE) under Canadian GAAP?
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A. A corporation that has no public shareholders.
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B. A corporation that has less than 500 shareholders and is not listed on a stock exchange.
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C. A corporation which is not profit oriented.
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D. A profit oriented enterprise that has none of its issued and outstanding financial
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instruments traded in a public market and does not hold assets in a fiduciary capacity for
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abroad group of outsiders as one of its primary businesses.
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horganizations. hTopic: h01-05 hGAAP hfor h Private hEnterprises




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, 6. Which enterprises must report under IFRS in Canada?
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A. All corporations, government agencies and private companies.
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B. Public companies and private companies whose shareholders' equity is in excess of
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$500,000,000 at any particular year end.
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C. Public companies, private companies and not-for-profit organizations.
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D. Publicly accountable enterprises.
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Learning hObjective: h01-02 hDescribe hhow haccounting hstandards hin hCanada hare htailored hto hdifferent htypes hof
horganizations. hTopic: h01-04 hGAAP hfor h Publicly h Accountable hEnterprises




7. What approach did Canada first decide to take with respect to convergence with IFRS?
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A. Harmonization of CPA Canada Handbook with IFRS. h h h h h h


B. Substituting IFRS for Canadian GAAP when approved by the IASB.
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C. Adopting some but not necessarily all IFRSs by reviewing them on a case by case basis.
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D. Reviewing them with all publically accountable entities to see which ones would
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beacceptable.
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Learning hObjective: h01-02 hDescribe hhow haccounting hstandards hin hCanada hare htailored hto hdifferent htypes hof
horganizations.hTopic: h01-04 hGAAP hfor h Publicly h Accountable hEnterprises




8. What choice(s) do private enterprises have in their financial reporting in Canada?
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A. They have no choice at all; they will need to report under IFRS.
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B. They may elect to continue with differential reporting.
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C. They may adopt accounting principles that are appropriate to the circumstances.
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D. They may elect to report under either IFRS or ASPE but once adopted, must use all
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thestandards.
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Difficulty: hEasy
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horganizations. hTopic: h01-05 hGAAP hfor h Private hEnterprises




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