Professional Documents
Culture Documents
BSA 2-6
MULTIPLE CHOICE.
Instructions:
Choose the best answer and Underline the LETTER AND CHANGE THE FONT
TO RED.
A. IFRS Foundation.
B. IFRS Advisory Council.
C. International Accounting Standards Committee.
D. International Financial Reporting Interpretations Committee.
11. The IASB declared that the merits of proposed standards are assessed
14. Under Section 5 of RA 9298, who shall appoint the members of the Professional
Regulatory Board of Accountancy?
A. The chairman of the Board of Accountancy.
B. The president of the Republic of the Philippines.
C. The chairperson of Professional Regulations Commission.
D. The president of Philippine Institute of Certified Public Accountants.
15. The following statements relate to the Board of Accountancy. Select the incorrect
statement:
A. The Board consists of a Chairman and six
members.
B. The chairman and members of the Board
are appointed by the President of the
Philippines upon recommendation of the
Professional Regulation Commission.
C. The Professional Regulation Commission
may remove from the Board of
Accountancy, any member whose
certificate to practice has been revoked or
suspended.
D. All sectors of accountancy practice shall
as much as possible be equitably
represented in the Board.
16. this accounting objective emphasizes the importance of the Income Statement as it
is geared toward proper income or performance determination of the enterprise.
A. Entity theory. C. Proprietary theory.
B. Fund theory D. Residual equity theory.
18. Which of the following is not a description or a function of the Financial Reporting
Standards Council (FRSC)?
21. Under the Conceptual Framework for Financial Reporting which of the following
statements is not a feature of financial information’s “comparability” characteristics?
A. Comparability is uniformity.
B. A comparison requires at least two items.
C. Consistency, although related to comparability, is not the same.
D. Comparability is the goal; consistency helps to achieve that goal.
22. When fair value is used in measuring assets in the financial statements, current
GAAP provides following references as basis of fair value, except
23. The objectives of financial reporting for business enterprises are based on
24. Which of the following statements regarding users of financial information is correct?
25. Which of the following statements is (are) true, concerning the Going Concern
assumption?
26. If accounting information is timely, and has predictive as well as feedback value,
then it is considered to be
A. relevant C. understandable
B. reliable D. verifiable
27. In the first week of December 2016, Elisa Company signs a major contract to
develop an accounting information system for Edward Inc. No work is begun the current
year, yet the notes to the financial statements discuss the nature and peso amount of
the contract. This is an example of:
28. Which of the following statements best describes the term “going concern”?
A. The expenses of an entity exceed its income
B. When current liabilities of an entity exceed current assets
C. The ability of the entity to continue in operation for the foreseeable future
D. The potential to contribute to the flow of cash and cash equivalents to the entity
29. Which TWO of the following are listed in the IASB Framework as ‘underlying
assumptions’ regarding financial statements?
31. Which of the following is the best description of reliability in relation to information in
financial statements?
32. According to the IASB Framework for the preparation and presentation of financial
statements, which TWO of the following are examples of expenses?
33. An expiration of cost which is incurred without compensation or return and is not
absorbed as cost of revenue is called
34. Which of the following best describes the distinction between expenses and losses?
A. Losses are material items whereas expenses are immaterial items
B. Losses are extraordinary charges whereas expenses are ordinary charges
C. Losses are reported net-of-related-tax effect whereas expenses are not reported not-
of-tax
D. Losses results from peripheral or incidental transactions whereas expenses result
from ongoing major or central operations of the entity
35. Which of the following statements about accounting recognition is (are) true?
I. In accounting, there are instances when a gain/loss would arise upon initial recognition
of an asset.
II. No asset can simultaneously be an asset of more than one entity
III. At times, two or more entities may share the benefits that an asset provides
IV. An appropriate basis for recognizing an asset is when a particular enterprise acquires the
right to utilize and control access to the asset’s benefits able
36. Which one of the following terms best describes the amount of cash or cash
equivalents that could currently be obtained by selling an asset in an orderly disposal?
37. Which of the following assets are initially and subsequently measured at Fair Value?
I. Biological assets IV. Property and Equipment
II. Available for sale securities V. Held for trading securities
III. Inventories VI. Intangible assets
A. I and II only C. I, II, III and V only
B. I, II and III only D. I, II, IV, and V only
A. Data on segments having the same expected risks and growth rates are reported to
analysts estimating future profits.
B. Financial statements are issued nine months late.
C. Management reports to stockholders’ new projects undertaken, but the financial
statements never report the projected results.
D. Financial statements include a property with a carrying amount increased to
management’s estimate of market value.
B. It has the highest level of authority. In case of a conflict between the Framework and
s Standard or Interpretation, the Framework overrides the Standard or Interpretation.
43. Which of the following is the first step within hierarchy of guidance to which
management refers, and whose applicability at considers, when selecting accounting
policies?
A. Apply the requirements in PFRS dealing with similar and related issues.
B. Apply a standard from PFRS if it specifically relates to the transaction, event, or
condition.
C. Consider the applicability of the definitions, recognition criteria, and measurement
concepts in the Conceptual Framework.
D. Consider the most recent pronouncements of other standard-setting bodies to the
extent they do not conflict with PFRS or the Conceptual Framework?
44. Under the Conceptual Framework for Financial Reporting 2010, which of the
following is a new item added in its scope but is still a work-in-progress?
True or False. Write the word true if correct after the phrase and false if not correct and
underline with red font that makes the statement incorrect.
1. The principal difference between two concepts of capital maintenance is the same of
the effects of changes in the prices of assets and liability of the entity. False
2. The selection of the appropriate concept of capital by an entity should be based on
the needs of the users of its financial statements. True
3. The concept of capital maintenance chosen by an entity shall determine the
measurement bases used in the preparation of its financial statements. False
4. The Conceptual Framework serves as a standard in developing future financial
reporting standards and in reviewing existing ones. False
5. The Conceptual Framework is a source of standards for determining an accounting
treatment where a standard does not provide specific guidance. False
6. The Conceptual Framework does not in any was assist prepares of financial
statements in applying PFRS and in dealing with topics that have yet to form the subject
of PFRS. False
7. The Conceptual Framework is a PFRS, and some provisions in it overrides any
specific PFRS, including PFRS that is in some respect in conflict with the Conceptual
Framework. False
8. The GPFS show the results of the stewardship of the management for the resources
entrusted to it by the capital providers. True
9. The GPFS are prepared at least annually and are directed to both the common and
specific information needs of a wide range of statement users. False
10. The GPFS provide information about the financial position, performance and cash
flows of an enterprise that is useful to a wide range of users in making economic
decisions. True