Question 1

Transaction costs that are directly attributable to the acquisition of a financial asset shall be Response:
Capitalized as cost of the financial asset Score: 1 out of 1 /

Question 2

To be reported as ‘cash and cash equivalent”, the cash and cash equivalent must be

Response Unrestricted in use for current operations Score 1 out of 1 /

Question 3

E Which of the following cost of conversion cannot be included in cost of inventory?

Response Salaries of staff (sales department shares the building with factory) Score 1 out of 1 /

Question 4

If material, deposits in foreign bank which are subject to foreign exchange rate restriction shall be
classified

Response: Separately as non-current asset, with appropriate disclosure.

Score: 1 out of 1 /

Question 5

Bank statement provide information about all of the following, except

Response Errors made by the depositor Score 1 out of 1 /

Question 6

In the case of long-term installments receivable (real estate installment sales) where a major portion of
the receivables will be collected beyond the normal operating cycle

Response Only the portion currently due is shown as current and the balance as noncurrent
Question 7

At the end of the current year, an entity had various checks and papers in its safe. Which should not be
included in its c count in the year-end statement of financial position?

Response: Past due promissory note issued in favor of the entity by its President.

Score: 1 out of 1 /

Question 8

All of the following can be classified as cash and cash equivalents, except?

Response Equity investments

Score: 1 out of 1 /

Question 9

A financial asset is held for trading if (choose the incorrect one

Response It is derivative that is not designated as effective hedging instrument Score Bout of 1 X

Question 10

What is the major purpose of an imprest petty cash fund?

Response To effectively control cash disbursements

Score: 1 out of 1

Question 11

Which of the following statements in relation to the cash short or over account is true?

Response The entry to account for daily cash sales for which small amount of cash shortage existed
would include a debit to cash short short or over account. Score 1 out of 1 /

Question 12

Trade receivables are classified as current assets if they are reasonably expected to be collected

Response within one year or within the operating cycle whichever is longer Score 1out of 1
Question 13

Transaction costs directly attributable to the acquisition of a financial asset do not include Response:
Financing and administrative costs Score: 1 out of 1

Question 14

The petty cash fund account under the imprest fund system is debited Response: When the fund is
created and everytime it is replenished.

Score: 0 out of 1 X

Question 15

One in five students ._____ choosing to attend the university.

Response regrets

Score 1 out of 1

Question 16

A compensating balance

Response: Must be included in cash and cash equivalent.

Score: 0 out of 1 X

Question 17

Which of the following is not a financial instrument?

Response A perpetual debt instrument, meaning no maturity date, that pays interest annually extending
into the indefinite future

Score 0 out of 1 X Sc

Question 18

Which of the following shall not be considered cashfor financial reporting purposes?

Response Post-dated checks and IOUs

Score:out of 1
Question 19

Which is the proper presentation of receivables in the statement of financial position?

Response: Trade receivables and nontrade receivables which are currently collectible shall be presented
as one line item called trade and other receivables'

Score: 1 out of 1 /

Question 20

When a petty cash fund is used, which of the following is true?

Response The reimbursement of the petty cash fund should be credited to the cash account.

Score 1 out of 1

Question 21

Under PFRS 9, which of the following is not a category of financial assets?

Response Financial assets at amortized cost Score: 0 out of 1 ?

Question 22

Which of the following statements is false?

Response: A certified check is one drawn by a bank upon itself.

Score: 1 out of 1 /

Question 23

Inventories are assets (choose the incorrect one)

Response held for use in the production or supply of goods or services

Score 1 out of 1 /

Question 24

All of the following financial assets shall be measured at fair value through profit or loss except

Response Financial assets at amortized cost

Score 1 out of 1 /
Question25

Transaction costs include

Response: Fees and commission paid to agent, levies by regulatory authorities, transfer taxes and duties

Score: 1 out of 1 /

Question 26

Which statement is correct concerning recognition of unrealized gains and losses on financial assets?

I. Unrealized gains and losses on financial assets held for trading shall be included in profit or
loss

Il Unrealized gains and losses on financial assets measured at amortized cost shall be included as
component of other comprehensive income Response I only

Score 1 out of 1 /

Question 27

The inventory of a service provider may simply be described as

Response Work in progress

Score 1 out of 1

Question 28

If the cash balance shown on entity's accounting records is less than the correct cash balance and
neither the entity nor the bank has made any errors, there must be

Response Deposits credited by the bank but not yet recorded by the entity

Score 1 out of 1

Question 29

A Cash Over and Short account

Response is debited when the petty cash fund proves out short Score out of 1

Question 30
Every qualified associate in any of the firm’s offices, plus many accountants from the outside, _ the
opportunity to apply for the open manager’s position.

Response has

Score 1 out of 1

Question 31

It is any contract that evidences residual interest in the assets of an entity after deducting all its liabilities

Response Equity instrument

Score 1 out of 1 /

Question 32

It is any contract that gives rise to both a financial asset of one entity and a financial labuty or equity
iristrumerit c” another entity

Response Financial Instrument

Question 33

The plan of the organization and all the methods and measures adopted within an entity to safeguard its
assets, check the accuracy of its accounting data, promote operational efficiency, and encourage
adherence to managerial policies is called

Response: Internal control

Score: 1 out of 1 /

Question 34

If the financial asset is held for trading or if the financial asset is measured at fair value through profit or
loss, transaction cost directly attributable to the acquisition shall be

Response Deferred and amortized over a reasonable period

Score 0 out of1

Question 35

5 lt either clients copractitioners ..... to end an engagement. proper documentation should explain the
action

Response decide

Question 38

Which of the following must be deducted from the bank statement balance in preparing a bank
reconciliation which ends with adjusted balance?

Response Outstanding check

Score: 1 out of 1

Question 39

Neither the client nor the practitioner . any concerns about filing the tax return by the due date

Response has

Score 1 out of 1

Question 40

E Nontrade receivables are classified as current assets only if they are reasonably expected to be
realized in cash

Response Within one year notwithstanding the length of the operating cycle

Score tout of 1 /

Question 41

The department managers and the CEO _ the power to approve changes in the project

Response: have

Score: 1 out of 1

Question 42
Which of the following should not be take n into account when determining the cost of inventories?

Response Trade discounts

Score 0 out of 1 X

Question 43

Which of the following items must be added to the cash balance per ledger in preparing a bank
reconciliation which ends with adjusted cash balance?

Response Note receivable collected by bank in favor of the depositor and credited to the account of the
depositor

Score: 1 out of 1/

Question 44

Depending on the business model for managing financial assets, an entity shall classify financial assets
subsequent initial recognition at Response Amortized cost

Score 0 out of 1 X

Question 45

The cost of inventory comprises all of the following, except

Response Abnormal amount of wasted material

Score:1 out of 1 /

Question 46

Francial assets include all of the following, except

Response Prepe : expenses

Score: out of/t /

Question 47

A bank reconciliation is

Response: A statement sent by bank to the depositor a monthly basis.

Score: 0 out of 1 X

Question 48

Which will not require an adjusting entry on the depositor's books?

Response Check in payment of account payable amounting to P50,000 is recorded by the depositor as
P5,000

Score 0 out of 1 X

Question 49

Accounts receivable shall be recognized initially at

Response Face value

Score out of 1

Question 50

Which statement is correct concerning subsequent measurement of financial asset at fair value?

1. The financial asset shall be measured at fair value if the business model is not to collect
contractual cash flows on specified dates and contractual cash flows are not solely payments of
principal and interest.

Il. An entity may designate a financial asset as measured at fair value through profit or loss even if the
financial asset satisfies the amortized cost measurement

Response Both I and II

Score 1 out of 1