CFAS Final: Key Concepts and Application
If doing so eliminates or reduces an accounting mismatch - correct answer ✔✔Under what condition can
an entity classify financial asset that meets the amortized cost criteria at FVPL?
Integral part of the entity's basic financial statements - correct answer ✔✔An entity shall prepare and
present a statement of cash flows as
Cost of designing product for specific customers - correct answer ✔✔Costs incurred in bringing the
inventory to the present location and condition include
C. Production of agricultural produce - correct answer ✔✔Biological transformation results from asset
changes through all of the following, except
A. Procreation
B. Degeneration
C. Production of agricultural produce
D. Growth
D. Biological asset and agricultural produce - correct answer ✔✔Agricultural activity results in which of
the following type of asset?
A. Neither biological, asset nor agricultural produce
B. Agricultural produce
C. Biological asset
D. Biological asset and agricultural produce
Inventory - correct answer ✔✔Consumable stores or supplies to be consumed in the production process
are reported as
,B. to rectify inappropriate accounting policies - correct answer ✔✔Which of the following is not a
purpose of the notes?
A. to present information about the basis of preparation of the financial statements and the specific
accounting policies
B. to rectify inappropriate accounting policies
C. to disclose the information required by PFRSS that is not presented elsewhere in the financial
statements
D. to provide information that is not presented elsewhere in the financial statements but is relevant to
an understanding of any of the financial statements.
C. Entity A considers the items included in these line items as dissimilar and cannot be included in
material classes of similar items and are also individually immaterial to warrant separate presentation. -
correct answer ✔✔The financial statements of Entity A shows line items described as "Other current
assets," "Other noncurrent liabilities," and "Miscellaneous expenses." Which of the following is correct?
1/1
A. Entity A considers the items included in these line items as individually material but with dissimilar
nature or function.
B. This manner of presenting items is unacceptable under PAS 1.
C. Entity A considers the items included in these line items as dissimilar and cannot be included in
material classes of similar items and are also individually immaterial to warrant separate presentation.
D. Entity A considers the items included in these line items as comprising a material class of similar
items.
Other Comprehensive Income - correct answer ✔✔This term comprises items of income and expense
including reclassification adjustments, that are not recognized in profit or loss as required or permitted
by PFRS.
More than the face amount of the bond - correct answer ✔✔When an investor purchased a bond
between interest dates at a premium, the cash paid to the seller is
D. Systematic allocation of administrative overhead - correct answer ✔✔The costs of conversion of
inventory include all of the following, except
1/1
, A. Costs directly related to the units of production, such as direct labor
B. Systematic allocation of variable production overhead
C. Systematic allocation of fixed production overhead
D. Systematic allocation of administrative overhead
Accrual Basis - correct answer ✔✔On Day 1, a customer buys goods from Entity A and promises to pay
the sale price on Day 30. Entity A recognizes sales revenue on Day 1 rather than on Day 30. This is an
application of which of the following accounting concepts?
B. All of these statements are true. - correct answer ✔✔Which statement is true when a financial asset
at FVOCI is reclassified to FVPL?
1/1
A. The cumulative gain or loss previously recognized in OCI is reclassified to profit or loss.
B. All of these statements are true.
C. The fair value at reclassification date becomes the new carrying amount.
D. The financial asset continues to be measured at fair value.
C. Payment of taxes - correct answer ✔✔Which of the following events is not considered an exchange or
reciprocal transfer?
A. Purchase of inventory on account
B. Lending money to another entity
C. Payment of taxes
D. Payment of loan payable
Charge to expense for the period - correct answer ✔✔What is the treatment for abnormal freight in?
The price that would be received to sell the asset at the measurement date. - correct answer ✔✔Fair
value of an asset should be based upon
If doing so eliminates or reduces an accounting mismatch - correct answer ✔✔Under what condition can
an entity classify financial asset that meets the amortized cost criteria at FVPL?
Integral part of the entity's basic financial statements - correct answer ✔✔An entity shall prepare and
present a statement of cash flows as
Cost of designing product for specific customers - correct answer ✔✔Costs incurred in bringing the
inventory to the present location and condition include
C. Production of agricultural produce - correct answer ✔✔Biological transformation results from asset
changes through all of the following, except
A. Procreation
B. Degeneration
C. Production of agricultural produce
D. Growth
D. Biological asset and agricultural produce - correct answer ✔✔Agricultural activity results in which of
the following type of asset?
A. Neither biological, asset nor agricultural produce
B. Agricultural produce
C. Biological asset
D. Biological asset and agricultural produce
Inventory - correct answer ✔✔Consumable stores or supplies to be consumed in the production process
are reported as
,B. to rectify inappropriate accounting policies - correct answer ✔✔Which of the following is not a
purpose of the notes?
A. to present information about the basis of preparation of the financial statements and the specific
accounting policies
B. to rectify inappropriate accounting policies
C. to disclose the information required by PFRSS that is not presented elsewhere in the financial
statements
D. to provide information that is not presented elsewhere in the financial statements but is relevant to
an understanding of any of the financial statements.
C. Entity A considers the items included in these line items as dissimilar and cannot be included in
material classes of similar items and are also individually immaterial to warrant separate presentation. -
correct answer ✔✔The financial statements of Entity A shows line items described as "Other current
assets," "Other noncurrent liabilities," and "Miscellaneous expenses." Which of the following is correct?
1/1
A. Entity A considers the items included in these line items as individually material but with dissimilar
nature or function.
B. This manner of presenting items is unacceptable under PAS 1.
C. Entity A considers the items included in these line items as dissimilar and cannot be included in
material classes of similar items and are also individually immaterial to warrant separate presentation.
D. Entity A considers the items included in these line items as comprising a material class of similar
items.
Other Comprehensive Income - correct answer ✔✔This term comprises items of income and expense
including reclassification adjustments, that are not recognized in profit or loss as required or permitted
by PFRS.
More than the face amount of the bond - correct answer ✔✔When an investor purchased a bond
between interest dates at a premium, the cash paid to the seller is
D. Systematic allocation of administrative overhead - correct answer ✔✔The costs of conversion of
inventory include all of the following, except
1/1
, A. Costs directly related to the units of production, such as direct labor
B. Systematic allocation of variable production overhead
C. Systematic allocation of fixed production overhead
D. Systematic allocation of administrative overhead
Accrual Basis - correct answer ✔✔On Day 1, a customer buys goods from Entity A and promises to pay
the sale price on Day 30. Entity A recognizes sales revenue on Day 1 rather than on Day 30. This is an
application of which of the following accounting concepts?
B. All of these statements are true. - correct answer ✔✔Which statement is true when a financial asset
at FVOCI is reclassified to FVPL?
1/1
A. The cumulative gain or loss previously recognized in OCI is reclassified to profit or loss.
B. All of these statements are true.
C. The fair value at reclassification date becomes the new carrying amount.
D. The financial asset continues to be measured at fair value.
C. Payment of taxes - correct answer ✔✔Which of the following events is not considered an exchange or
reciprocal transfer?
A. Purchase of inventory on account
B. Lending money to another entity
C. Payment of taxes
D. Payment of loan payable
Charge to expense for the period - correct answer ✔✔What is the treatment for abnormal freight in?
The price that would be received to sell the asset at the measurement date. - correct answer ✔✔Fair
value of an asset should be based upon
