Which defines property, plant and equipment?

All of these define property, plant and equipment

2. The cost of an item of property, plant and equipment comprises all of the following, except

Initial estimate of the cost of dismantling and removing the item and restoring the site, the
obligation for which the entity does not incur when the Item was acquired

3. Directly attributable costs in bringing asset to the location and condition for the intended
use include all of the following, except

Cost of employee benefits not arising directly from the acquisition of property, plant and
equipment.

4. If payment for an asset is deferred beyond normal credit terms, the difference between the
total payment and cash price equivalent should be

Amortized as interest expense over the credit period

5. When a plant asset is acquired by issuance of ordinary shares, the cost is properly
measured at

Fair value of plant asset

6. MULTIPLE CHOICE:
Government grant shall be recognized when there is reasonable assurance that

The entity will comply with the conditions of the grant and the grant will be received

7. MULTIPLE CHOICE:
A grant that becomes receivable as compensation for losses already incurred or for the
purpose of giving immediate financial support should be recognized as income
 Of the period in which it becomes receivable

8. MULTIPLE CHOICE:
If the cost of the asset is recorded net of the government grant

Asset will likely be understated

9. MULTIPLE CHOICE:
Government assistance includes all the following except

Improved irrigation water system 01' infrastructure for the benefit of an entire local community

10. MULTIPLE CHOICE:

Which disclosure is not required in relation to government grant?

The name of the government agency that gave the grant

MULTIPLE CHOICE:
Which defines property, plant and equipment?

All of these define property, plant and equipment

2. MULTIPLE CHOICE:
The cost of an item of property, plant and equipment comprises all of the following, except

Initial estimate of the cost of dismantling and removing the item and restoring the site, the
obligation for which the entity does not incur when the Item was acquired

3. MULTIPLE CHOICE:
Directly attributable costs in bringing asset to the location and condition for the intended
use include all of the following, except

Cost of employee benefits not arising directly from the acquisition of property, plant and
equipment.
4. MULTIPLE CHOICE:
If payment for an asset is deferred beyond normal credit terms, the difference between the
total payment and cash price equivalent should be

Amortized as interest expense over the credit period

5. MULTIPLE CHOICE:
When a plant asset is acquired by issuance of ordinary shares, the cost is properly
measured at

Fair value of plant asset

6. MULTIPLE CHOICE:
Government grant shall be recognized when there is reasonable assurance that

The entity will comply with the conditions of the grant and the grant will be received

7. MULTIPLE CHOICE:
A grant that becomes receivable as compensation for losses already incurred or for the
purpose of giving immediate financial support should be recognized as income

Of the period in which it becomes receivable

8. MULTIPLE CHOICE:
If the cost of the asset is recorded net of the government grant

Asset will likely be understated

9. MULTIPLE CHOICE:
Government assistance includes all the following except

Improved irrigation water system 01' infrastructure for the benefit of an entire local community

10. MULTIPLE CHOICE:

Which disclosure is not required in relation to government grant?
 The name of the government agency that gave the grant

→ Correct

You are an auditor. ABC Philippines Co., your client, is not sure on what to disclose in its
financial statements as its functional currency. Relevant information follows: ABC Philippines
Co. is a branch of ABC U.S. Co. ABC Philippines operates in a Philippine Economic Zone
Authority (PEZA) Special Economic Zone. ABC Philippines is engaged in the apparel business.
All of its raw materials are imported from the main office in the U.S. and all of its finished
products are exported directly to U.S. customers. The U.S. customers remit payments to the
U.S. main office. The U.S. main office will then provide the Philippine branch its working capital
needs. None of ABC Philippines Co.s’ finished products are sold in the Philippines. The raw
materials imported and finished goods exported are denominated in U.S. dollars. What is ABC
Philippines Co.’s functional currency?

U.S. dollar

2. MULTIPLE CHOICE:
You are an auditor. ABC Philippines Co., your client, is not sure on what to disclose in its
financial statements as its functional currency. Relevant information follows: ABC
Philippines Co. is a branch of ABC U.S. Co. ABC Philippines operates in a Philippine
Economic Zone Authority (PEZA) Special Economic Zone. ABC Philippines is engaged in
the apparel business. All of its raw materials are imported from the main office in the U.S.
and all of its finished products are exported directly to U.S. customers. The U.S. customers
remit payments to the U.S. main office. The U.S. main office will then provide the Philippine
branch its working capital needs. None of ABC Philippines Co.s’ finished products are sold
in the Philippines. The raw materials imported and finished goods exported are
denominated in U.S. dollars. ABC Philippines Co. is required to file audited financial
statements with the Philippine Securities and Exchange Commission (SEC) and the Bureau
of Internal Revenue (BIR). What is the presentation currency for the financial statements to
be filed with the said government agencies?

Philippine peso

3. MULTIPLE CHOICE:
These are those which do not give rise to a right to receive (or an obligation to deliver) a
fixed or determinable amount of money.

Non-monetary items
4. MULTIPLE CHOICE:
On December 1, 20x1, you imported a machine from a foreign supplier for $100,000, due for
settlement on January 6, 20x2. Your functional currency is the Philippine peso. When
preparing the December 31, 20x1 statement of financial position, which of the following will
you translate to the closing rate?

accounts payable

5. MULTIPLE CHOICE:
5. Use the information in Problem #4 above. The relevant exchange rates are as follows:
Dec. 1, 20x1 Dec. 31, 20x1 Jan. 6, 20x2 ₱50:$1 ₱52:$1 ₱47:$1 How much foreign exchange
gain (loss) will you recognize on December 31, 20x1?

(200,000)

6. MULTIPLE CHOICE:
On January 1, 20x1, Entity A obtained a 10%, ₱5,000,000 loan, specifically to finance the
construction of a building. The proceeds of the loan were temporarily invested and earned
interest income of ₱180,000. The construction was completed on December 31, 20x1 for
total construction costs of ₱7,000,000. How much is the cost of the building on initial
recognition?

7320000

7. MULTIPLE CHOICE:
Which of the following may not be considered a “qualifying asset” under PAS 23?

An expensive private jet that can be purchased from a local vendor.

8. MULTIPLE CHOICE:
An asset is being constructed for an enterprise's own use. The asset has been financed
with a specific new borrowing. The interest cost incurred during the construction period as
a result of expenditures for the asset is

a part of the historical cost of acquiring the asset to be written off over the estimated useful life of
the asset.

9. MULTIPLE CHOICE:
PAS 24 requires the disclosure of key management personnel compensation. Which of the
following is not included in this disclosure?
 reimbursements of officers’ out-of-pocket expenses

10. MULTIPLE CHOICE:

The amount of benefits to be received by employees enrolled in a defined benefit plan is

None of them

Which of the following best describes the term ‘significant influence’ as used under PAS 28?

The power to participate in the financial and operating policy decisions of an entity.

2. MULTIPLE CHOICE:
Entity A owns 25% of the voting rights in Entity B. However, Entity A has no representation
on the board of directors of Entity B. Which of the following statements is correct?

Entity A is presumed to have signification influence over Entity B because it holds 20% or more of
the voting rights in Entity B.

3. MULTIPLE CHOICE:
On January 1, 20x1, Entity A acquires 25% interest in Entity B for ₱800,000. Entity B reports
profit of ₱1,000,000 and declares dividends of ₱100,000 in 20x1. How much is the carrying
amount of the investment in associate on December 31, 20x1?

1025000

4. MULTIPLE CHOICE:
The Hanwell Company acquired a 30% equity interest in The Northfield Company for
CU400,000 on 1 January 20X6. In the year to 31 December 20X6 Northfield earned profits of
CU80,000 and paid no dividend. In the year to 31 December 20X7 Northfield incurred losses
of CU32,000 and paid a dividend of CU10,000. In Hanwell's consolidated statement of
financial position at 31 December 20X7, what should be the carrying amount of its interest
in Northfield, according to IAS 28 Investments in associates?

CU411,400
5. MULTIPLE CHOICE:
PAS 29 is generally not applied by entities unless their functional currency is that of a
hyperinflationary economy. This is because of which of the following basic accounting
concepts?

Stable monetary assumption

6. MULTIPLE CHOICE:
2. Entity A operates in a hyperinflationary economy. Entity A has the following assets
before restatement on December 31, 20x1: Investment in bonds (amortized cost) ₱700,000
Land 1,000,000 The land was acquired on May 21, 20x0. The general price indices are as
follows: May 21, 20x0 100 January 1, 20x1 160 Average – 20x2 180 December 31, 20x1 220
What are the restated amounts of the investment in bonds?

700,000

7. MULTIPLE CHOICE:
2. Entity A operates in a hyperinflationary economy. Entity A has the following assets
before restatement on December 31, 20x1: Investment in bonds (amortized cost) ₱700,000
Land 1,000,000 The land was acquired on May 21, 20x0. The general price indices are as
follows: May 21, 20x0 100 January 1, 20x1 160 Average – 20x2 180 December 31, 20x1 220
What are the restated amounts of the land?

2200000

8. MULTIPLE CHOICE:
Which of the following is within the scope of PAS 32?

Financial instruments that are within the scope of PFRS 9

9. MULTIPLE CHOICE:
Which of the following is not a financial asset?

Inventory

10. MULTIPLE CHOICE:

These are bonds that can be exchanged for shares of stocks of the issuer.

Convertible bonds
. Entity A had 100,000, ₱10 par, 10% cumulative preference shares outstanding all throughout
20x1. Entity A reported profit after tax of ₱1,200,000 for the year ended December 31, 20x1. The
movements in the number of ordinary shares are as follows: 1/1/20x1 Ordinary shares
outstanding 120,000 3/1/20x1 Shares issued for cash 42,000 9/30/20x1 Subscribed shares 20,000
11/1/20x1 Reacquisition of treasury shares (12,000) Outstanding shares at the end of period
170,000 What is the basic earnings per share?

6.96

2. MULTIPLE CHOICE:
2. Entity A is computing for its basic earnings per share and has gathered the following
information: Loss for the year (800,000) Preferred dividends 50,000 Outstanding ordinary
shares 100,000 There have been no changes in the number of outstanding ordinary shares
during the period. What is the basic earnings (loss) per share?

-8.5

3. MULTIPLE CHOICE:
occurred: • On April 1, 20,000 shares were issued for cash. • On September 30, a 10% bonus
issue (share dividend) was declared. • On November 1, a 2-for-1 share split was issued.
Entity A had the following profits: ₱1,200,000 in 20x2 and ₱900,000 in 20x1. What are the
earnings per share to be disclosed in Entity A’s 20x1 comparative financial statements?

2.05

4. MULTIPLE CHOICE:
occurred: • On April 1, 20,000 shares were issued for cash. • On September 30, a 10% bonus
issue (share dividend) was declared. • On November 1, a 2-for-1 share split was issued.
Entity A had the following profits: ₱1,200,000 in 20x2 and ₱900,000 in 20x1. What are the
earnings per share to be disclosed in Entity A’s 20x2 comparative financial statements?

2.54

5. MULTIPLE CHOICE:
Entity A has 200,000 ordinary shares outstanding on January 1, 20x1. Entity A offers rights
issue to its existing shareholders that enable them to acquire 1 ordinary share at a
subscription price of ₱120 for every 5 rights held. The rights are exercised on May 1, 20x1.
The market price of one ordinary share immediately before exercisEntity A reported profit
after tax of ₱2,700,000 in 20x1. What is the basic earnings per share in 20x1?

11.71
6. MULTIPLE CHOICE:
If financial report contains both the consolidated financial statements of a parent and the
parent's separate financial statements, segment information is required in

The consolidated financial statement only

7. MULTIPLE CHOICE:
Close family members of an individual include all of the following, except

Brother or sister of the individual

8. MULTIPLE CHOICE:
Unrelated parties include all of the following, except

Post employment benefit plan for the benefit of employees

9. MULTIPLE CHOICE:
An entity shall disclose key management personnel compensation. Which of the following
is included in key management personnel compensation?

Both social security contribution and post employment benefit

10. MULTIPLE CHOICE:

Which statement is true regarding interim reporting?

Each statement must be mark unaudited