Ventura, MARY Mickaella R P.44 Statement OF Financial Position PDF

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Mary Mickaella Reyes Ventura BSA 2-C Among Us – Group 3

Problem 5 – Multiple Choice – theory 1. The purpose of general purpose financial statements is to provide information about the a. economic resources and obligations of an entity that is useful to a wide range of users in making economic decisions b. financial position and financial performance of an entity that is useful to a wide range of users in making economic decisions c. financial position, financial performance, and cash flows of an entity that is useful to a limited range of users in making economic decisions d. financial position, financial performance, and cash flows of an entity that is useful to a wide range of users in making economic decisions

2. A complete set of financial statements includes a. Directors reports

c. notes

b. income tax return

d. all of these

3. An additional statement of financial position as at the beginning of the preceding period is prepared when an entity makes (choose the incorrect statement) a. retrospective application b. retrospective restatement c. prospective application d. makes reclassification adjustments

4. According the PAS 1 Presentation of Financial statements, the general features of financial statements include all of the following, except a. Fair presentation and compliance with PFRSs b. Comparability of presentation c. Materiality and aggregation d. Comparative information

5. According the PAS 1 Presentation of Financial statements, inappropriate accounting policies are a. rectified either by disclosure of the accounting policies used or by notes or explanatory material b. not rectified either by disclosure of the accounting policies used or by notes or explanatory material c. permitted as long as they are used consistently from period to period d. disclosed in the notes only

6. When an entity changes the end of its reporting period and presents financial statements for a period longer or shorter than one year, an entity shall disclose all of the following, except a. the period covered by the financial statements b. the reason for using a longer or shorter period. c. the fact that amounts presented in the financial statements are not entirely comparable d. a quantification of the possible adjustments that would eliminate the effects of the longer or shorter reporting period

7. The statement of financial position may be presented either showing current/non-current distinction (classified) or based on liquidity (unclassified). PAS 1 Presentation of financial statements encourages the a. classified presentation

c. combination of a and b

b. unclassified presentation

d. none of these

8. In a classified statement financial position, PAS 1 Presentation of financial statements requires deferred tax assets and deferred tax liabilities to be presented as a. current items

c. either a or b

b. non-current items

d. none of these

9. PAS 1 Presentation of financial statements a. prescribes the order or format in which an entity presents items in the financial statements b. does not prescribe the order or format in which an entity presents items in the financial statements c. prescribes some order or some format in which an entity presents items in the financial statements d. does not deal with the presentation of items in the financial statements.

10. All of the following statements correctly refer to the provisions of PAS 1 Presentation of financial statements, except a. The objective of PAS 1 is to prescribe the basis for presentation of general purpose financial statements, to ensure comparability both with the entity’s financial statements of previous periods and with the financial statements of other entities b. PAS 1 shall be applied to all- purpose financial statements prepared and presented in accordance with Philippine Financial Reporting Standards (PFRS) c. The application of PFRSs, with additional disclosure when necessary, is presumed to result in financial statements that achieve a fair presentation.

d. Inappropriate accounting policies are not rectified either by disclosure of the accounting policies used or by notes or explanatory material.

11. Financial statements are structured representation of the financial position and financial performance of an entity. The objective of general purpose financial statements is to provide information about an entity’s (choose incorrect statement) a. financial position

c. cash flows

b. financial performance

d. valuation

12. The general features listed in PAS 1 includes the following I. Fair presentation and compliance with PFRS II. Accounting Entity III. Going concern IV. Accrual basis of Accounting V. Consistency of Presentation VI. Materiality and Aggregation VII. Offsetting VIII. Comparability a. I, II, III, IV, V, VI

c. I, III, IV, V, VI, VII

b. I, II, III, IV, V, VI, VII

d. all of these

13. In virtually all circumstances, a fair presentation is achieved by compliance with applicable PFRSs. A fair presentation also requires an entity (choose the incorrect statement) a. to select and apply accounting policies in accordance with PAS 8 Accounting policies, Change in Accounting Estimates and Errors. PAS 8 sets out a hierarchy of authoritative guidance that

management considers in the absence of a Standard or an Interpretation that specifically applies to an item b. to present information, including accounting policies in a manner that provides relevant, reliable, comparable and understandable information c. to have its financial statements examined by an external party d. to provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity’s financial position and financial performance.

14. All of the following are examples of offsetting, except a. presenting accounts receivable net of allowance for doubtful accounts. b. gains and losses on the disposal of non-current assets, including investments and operating assets, are reported by deducting from the proceeds on disposal and carrying amount of the asset and related selling expenses c. expenditure related to a provision that is recognized in accordance with PAS 37 Provisions, Contingent Liabilities and Contingent Assets and reimbursed under a contractual arrangement with a third party (for example, a supplier’s warranty agreement) are to be netted against the related reimbursement d. foreign exchange gains and losses or gains and losses arising on financial instruments held for trading are netted and presented as net gains or net losses in the income statement

15. Which of the following statements is incorrect? a. PAS 1 requires an entity to present assets and liabilities in the order of liquidity only when a liquidity presentation provides information that is reliable and is more relevant than a current/non-current presentation b. Financial statements are often made more understandable by presenting information in thousands or millions of units of the presentation currency. This is acceptable as long as the level of rounding in presentation is disclosed and material information is not omitted c. PFRSs apply to financial statements and to other information presented in an annual report or other document d. Financial statements shall be presented at least annually....