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CPA Australia Financial-Accounting-and-Reporting - CPA Financial Accounting and Reporting Exam

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Total 100 questions

Generally accepted accounting practice recognises revenue when

A.

goods are produced.

B.

customers order goods.

C.

cash is received for the goods.

D.

goods are dispatched to the customer.

According to the IASB Conceptual Framework, income is an increase in economic benefits in the form of

I)inflows.

II)decreases of liabilities.

III)enhancements of assets.

IV)contributions from equity holders.

A.

I, II and III only

B.

I, II and IV only

C.

I, III and IV only

D.

II, III and IV only

An agent is answerable under the contract to the agent's principal and must account for the resources of the agent's principal and the money the agent has gained working on the principal's behalf. In the context of agency, this definition describes an agent's

A.

contract.

B.

relationship.

C.

fiduciary duty.

D.

accountability.

A decrease in assets is most likely to be recognised in the financial report as

A.

a liability.

B.

an expense.

C.

revenue earned.

D.

a change in equity.

Which one of the following parties provides information to ensure that the financial statements show a true and fair view?

A.

shareholders

B.

tax consultants

C.

financial Institutions

D.

directors of the company

Which one of the following financial statements helps provide information about factors that might affect an entity's liquidity or solvency?

A.

statement of cash flows

B.

statement of changes in equity

C.

notes to the financial statements

D.

statement of profit or loss and other comprehensive income

In the context of a regulatory framework, a principles-based system

A.

is a rule-driven approach.

B.

attempts to cover specific eventualities.

C.

provides a theoretical basis with broad terms of reference.

D.

removes any element of judgement by providing clear requirements.

Which one of the following best describes the objective of the International Financial Reporting Standards (IFRS) Foundation?

A.

to co-ordinate the accounting profession on a global scale by issuing and establishing international standards

B.

to develop an International regulatory framework in the national jurisdictions of countries that produce accountants

C.

to guide investors who compare the financial statements of one entity in one country with those of another entity located elsewhere

D.

to promote the application, convergence and use of International Financial Reporting Standards (IFRS) as a high quality reporting solution

Investors use the audited financial statements of a company to

 I)evaluate the company's current return on assets

II)predict the company's market conditions for future years.

III)predict the company's market conditions for future years.

IV)make a judgement on the liquidity and solvency of the company.

A.

I and III only

B.

I and IV only

C.

II and III only

D.

III and IV only

Which one of the following would be included in the statement of financial position?

A.

depreciation

B.

deferred tax

C.

distribution costs

D.

gains on property valuations