TEST BANK For
Modern Advanced Accounting In Canada
10th Edition
By Darrell Herauf, Chima Mbagwu
Verified Chapter's 1 - 12 | Complete
1-1
,TABLE OF CONTENTS
CHAPTER 1 Conceptual and Case Analysis Frameworks for Financial Reporting
CHAPTER 2 Investments in Equity Securities
CHAPTER 3 Business Combinations
CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries
CHAPTER 5 Consolidation Subsequent to Acquisition Date
CHAPTER 6 Intercompany Inventory and Land Profits
CHAPTER 7 (A) Intercompany Profits in Depreciable Assets (B) Intercompany Bondholdings
CHAPTER 8 Consolidated Cash Flows and Changes in Ownership
CHAPTER 9 Other Consolidation Reporting Issues
CHAPTER 10 Foreign Currency Transactions
CHAPTER 11 Translation and Consolidation of Foreign Operations
CHAPTER 12 Accounting for Not-for-Profit and Public Sector Organizations
1-2
, Chapter 01
Conceptual and Case Analysis Frameworks for Financial Reporting
Multiple Choice Questions
1. Which of the following would NOT be a reason to obtain a greater understanding of
accounting practices in other nations?
A. Financial results are disclosed in different currencies.
B. One needs to be aware of differing disclosure requirements from nation to nation, as this
impacts the preparation of financial statements.
C. Income-smoothing may have affected a foreign subsidiary's results; such smoothing
practices are not permitted in North America.
D. Departures from the historical cost principle may be possible in other nations.
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 Describe and apply the conceptual framework for financial reporting.
Topic: 01-01 The Conceptual Framework for Financial Reporting
2. Which of the following would be most affected by financial statements being prepared
under different accounting principles?
A. Reduced comparability.
B. Reduced reliability.
C. Increased complexity.
D. Inaccurate asset valuations.
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 Describe and apply the conceptual framework for financial reporting.
Topic: 01-01 The Conceptual Framework for Financial Reporting
1-3
, 3. The CPA Canada Handbook - Accounting is the handbook of Canadian accounting
standards. Why do companies in Canada ensure that their financial reporting is consistent
with Canadian GAAP?
A. Their bank requires them to do so.
B. Their auditors require them to do so.
C. Reporting under the CPA Canada Handbook - Accounting is required by public companies'
boards of directors.
D. Compliance with the CPA Canada Handbook - Accounting pronouncements is usually
required by many legal statutes.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-01 fDescribe fand fapply fthe fconceptual fframework ffor ffinancial
freporting. f Topic: f01-01 fThe fConceptual fFramework ffor fFinancial fReporting
4. Which fdecision fhas fCanada fmade fwith frespect fto ffinancial freporting ffor
fprivate fenterprises?
A. To fadopt fthe fIFRS fstandards ffor fsmall fand fmedium-sized fenterprises.
B. To fretain fthe fcurrent fstandards.
C. To flook fto fUS fGAAP ffor fstandards.
D. To fdevelop fand fmaintain fits fown fstandards ffor fprivate fenterprises.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-02 fDescribe fhow faccounting fstandards fin fCanada fare ftailored fto fdifferent ftypes fof
forganizations. f Topic: f01-05 fGAAP ffor fPrivate fEnterprises
5. Starting fin f2011, fwhat fis fthe fdefinition fof fa fprivate fenterprise f(PE) funder fCanadian fGAAP?
A. A fcorporation fthat fhas fno fpublic fshareholders.
B. A fcorporation fthat fhas fless fthan f500 fshareholders fand fis fnot flisted fon fa fstock fexchange.
C. A fcorporation fwhich fis fnot fprofit foriented.
D. A fprofit foriented fenterprise fthat fhas fnone fof fits fissued fand foutstanding ffinancial
finstruments ftraded fin fa fpublic fmarket fand fdoes fnot fhold fassets fin fa ffiduciary fcapacity
ffor fa fbroad fgroup fof foutsiders fas fone fof fits fprimary fbusinesses.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-02 fDescribe fhow faccounting fstandards fin fCanada fare ftailored fto fdifferent ftypes fof
forganizations. f Topic: f01-05 fGAAP ffor fPrivate fEnterprises
1-4
Modern Advanced Accounting In Canada
10th Edition
By Darrell Herauf, Chima Mbagwu
Verified Chapter's 1 - 12 | Complete
1-1
,TABLE OF CONTENTS
CHAPTER 1 Conceptual and Case Analysis Frameworks for Financial Reporting
CHAPTER 2 Investments in Equity Securities
CHAPTER 3 Business Combinations
CHAPTER 4 Consolidation of Non-Wholly Owned Subsidiaries
CHAPTER 5 Consolidation Subsequent to Acquisition Date
CHAPTER 6 Intercompany Inventory and Land Profits
CHAPTER 7 (A) Intercompany Profits in Depreciable Assets (B) Intercompany Bondholdings
CHAPTER 8 Consolidated Cash Flows and Changes in Ownership
CHAPTER 9 Other Consolidation Reporting Issues
CHAPTER 10 Foreign Currency Transactions
CHAPTER 11 Translation and Consolidation of Foreign Operations
CHAPTER 12 Accounting for Not-for-Profit and Public Sector Organizations
1-2
, Chapter 01
Conceptual and Case Analysis Frameworks for Financial Reporting
Multiple Choice Questions
1. Which of the following would NOT be a reason to obtain a greater understanding of
accounting practices in other nations?
A. Financial results are disclosed in different currencies.
B. One needs to be aware of differing disclosure requirements from nation to nation, as this
impacts the preparation of financial statements.
C. Income-smoothing may have affected a foreign subsidiary's results; such smoothing
practices are not permitted in North America.
D. Departures from the historical cost principle may be possible in other nations.
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 Describe and apply the conceptual framework for financial reporting.
Topic: 01-01 The Conceptual Framework for Financial Reporting
2. Which of the following would be most affected by financial statements being prepared
under different accounting principles?
A. Reduced comparability.
B. Reduced reliability.
C. Increased complexity.
D. Inaccurate asset valuations.
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 Describe and apply the conceptual framework for financial reporting.
Topic: 01-01 The Conceptual Framework for Financial Reporting
1-3
, 3. The CPA Canada Handbook - Accounting is the handbook of Canadian accounting
standards. Why do companies in Canada ensure that their financial reporting is consistent
with Canadian GAAP?
A. Their bank requires them to do so.
B. Their auditors require them to do so.
C. Reporting under the CPA Canada Handbook - Accounting is required by public companies'
boards of directors.
D. Compliance with the CPA Canada Handbook - Accounting pronouncements is usually
required by many legal statutes.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-01 fDescribe fand fapply fthe fconceptual fframework ffor ffinancial
freporting. f Topic: f01-01 fThe fConceptual fFramework ffor fFinancial fReporting
4. Which fdecision fhas fCanada fmade fwith frespect fto ffinancial freporting ffor
fprivate fenterprises?
A. To fadopt fthe fIFRS fstandards ffor fsmall fand fmedium-sized fenterprises.
B. To fretain fthe fcurrent fstandards.
C. To flook fto fUS fGAAP ffor fstandards.
D. To fdevelop fand fmaintain fits fown fstandards ffor fprivate fenterprises.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-02 fDescribe fhow faccounting fstandards fin fCanada fare ftailored fto fdifferent ftypes fof
forganizations. f Topic: f01-05 fGAAP ffor fPrivate fEnterprises
5. Starting fin f2011, fwhat fis fthe fdefinition fof fa fprivate fenterprise f(PE) funder fCanadian fGAAP?
A. A fcorporation fthat fhas fno fpublic fshareholders.
B. A fcorporation fthat fhas fless fthan f500 fshareholders fand fis fnot flisted fon fa fstock fexchange.
C. A fcorporation fwhich fis fnot fprofit foriented.
D. A fprofit foriented fenterprise fthat fhas fnone fof fits fissued fand foutstanding ffinancial
finstruments ftraded fin fa fpublic fmarket fand fdoes fnot fhold fassets fin fa ffiduciary fcapacity
ffor fa fbroad fgroup fof foutsiders fas fone fof fits fprimary fbusinesses.
Accessibility: fKeyboard fNavigation
f Blooms: fRemember
Difficulty: fEasy
Learning fObjective: f01-02 fDescribe fhow faccounting fstandards fin fCanada fare ftailored fto fdifferent ftypes fof
forganizations. f Topic: f01-05 fGAAP ffor fPrivate fEnterprises
1-4
