Professional Documents
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9. A financial liability that is due to be settled within twelve months after the reporting period shall be
classified as noncurrent
a. When it is refinanced on a long-term basis before the issue of financial statements.
b. When the entity has the right at the end of the reporting period to roll over an obligation for at least
twelve months after the and of reporting period.
c. When it is refinanced on a long-term basis after the end of reporting period.
d. Under all of these circumstances.
10. When an entity breaches under a long-term loan agreement on or before the end of the reporting period
with the effect that the liability becomes payable on demand, the liability is classified as
a. Current under all circumstances
b. Noncurrent under all circumstances
c. Current if the lender agreed after the reporting period and before the issuance of the statements
not to demand payment as a consequence of the breach.
d. Noncurrent if the lender agreed after the end of the reporting period to provide a grace period for
at least twelve months after the reporting period.
11. The items which are reclassified to profit or loss in the current period but were recognized in other
comprehensive income in the current or previous period are
a. Prior period errors
b. Correcting entries
c. Unusual and irregular items
d. Reclassification adjustments
12. All of the following components of OCI should be reclassified to profit or loss, except
a. Gain and loss arising from translating the financial statements of a foreign operation.
b. Gain and loss on remeasuring debt investment at FVOCI.
c. The effective portion of gain or loss on hedging instrument in a cash flow hedge
d. Gain or loss on remeasuring equity investment at FVOCI.
15. What is the “first item” presented in the notes to financial statements?
a. Statement of compliance with IFRS.
b. Summary of significant accounting policies
c. Supporting information for items presented in the financial statements
d. Other disclosures, including contingent liabilities and nonfinancial disclosures
16. An entity shall disclose in the summary of significant accounting policies
a. The measurement basis used
b. The measurement basis whether used or not
c. The measurement basis used and accounting policies applied
d. Neither measurement basis nor accounting policies applied
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35. A noncurrent asset or disposal group shall be classified as held for sale when
a. The sale is highly probable.
b. The asset is available for immediate sale in the present condition.
c. The sale is probable and the asset is available for sale in the present condition.
d. The sale is highly probable and the asset is available for immediate sale in the present condition.
36. An entity shall classify a noncurrent asset as held for sale when
a. The carrying amount of the asset is recovered through a sale.
b. The carrying amount of the asset is recovered through continuing use.
c. The noncurrent asset is to be abandoned.
d. The noncurrent asset group is idle or retired from active use.
37. An entity shall measure a noncurrent asset or disposal group classified as held for sale at
a. Carrying amount
b. Fair value less cost of disposal
c. Lower of carrying amount and fair value less cost of disposal
d. Higher carrying amount and fair value less cost of disposal
38. A noncurrent asset that is to be abandoned should not be classified as held for sale because
a. The carrying amount is recovered principally through continuing use.
b. It is difficult to value.
c. It is unlikely that the noncurrent asset will be sold within 12 months.
d. It is unlikely that there will be an active market for the noncurrent asset.
39. How should the assets and liabilities of a disposal group held for sale be reported?
a. The assets and liabilities should be offset and presented as a single amount.
b. The assets of disposal group should be reported separately as current assets and the liabilities should
be shown as current liabilities separately.
c. The assets and liabilities should offset and presented as a deduction from equity.
d. There should be no separate disclosure of assets and liabilities of the disposal group.
40. An entity classified a noncurrent asset accounted for under the cost model as held for sale at the current
year-end. The entity decided at the end of the following year not to sell the asset but to continue to use it.
The asset should be measured at the end of the following year at
a. The lower of carrying amount and recoverable amount.
b. The higher of carrying amount and recoverable amount.
c. The lower of carrying amount on the basis that it had never been classified as held for sale and
recoverable amount.
d. The recoverable amount.
41. Which is not a criterion for an operation to be classified as discontinued?
a. The operation should represent a separate major line of business or geographical area.
b. The operation is part of a single plan to dispose of a separate major line of business or geographical
area.
c. The operation is a subsidiary acquired exclusively with a view to resale.
d. The operation must be sold within three months of the year-end.
42. Which is not required for component’s results to be classified as discontinued operations?
a. Management must have entered into a sale agreement
b. The component is available for immediate sale
c. The operation and cash flows of the component will be eliminated from the operations of the entity
as a result of the disposal
d. The entity will not have any significant continuing involvement in the operation of the component
after disposal
43. The results of the discontinued operation should be reported net of tax as
a. A prior period adjustment.
b. An other income and expense item.
c. A single amount after continuing operations and before net income.
d. A bulk sale of plant assets included in income from continuing operations.
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