Q201: An entity shall recognise revenue to depict the transfer of promised goods or services to customers in the___amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. subscription who will be personally liable
- A. Net
- B. Residual
- C. Gross
- D. Cumulative
Answer
Answer C. Gross
Q202: Which of the following is an exception for application of IFRS 15?
- A. Lease contracts
- B. Insurance contracts
- C. Pharmaceutical contracts
- D. A and B
Answer
Answer D. A and B
Q203: According to IFRS 15, the asset is transferred to a customer
- A. When the asset is physically delivered to the customers premises
- B. On the day specified by a contract with the customer
- C. When the customer obtains control over it
- D. On the day when the entity satisfies all performance obligations, specified in the contract with the customer
Answer
Answer C. When the customer obtains control over it
Q204: Changes in accounting policy are considered in depth in
- A. IAS 1
- B. IAS 8
- C. IAS 10
- A. D. IAS 18
Answer
Answer A. IAS 1
Q205: A change in accounting policy is allowed when
- A. An entity decides to change the method of accounting it uses
- B. An entity finds a better method for accounting for something which results in increased profits
- C. A new standard is issued suggesting a new way of accounting
- D. Applying a new way of accounting for a transaction which was not used in the past because the item was immaterial
Answer
Answer C. A new standard is issued suggesting a new way of accounting
Q206: Under IAS 16 how often should the useful life of an asset be reviewed?
- A. At least at each financial year end
- B. Every six months
- C. At managements discretion
- D. Never
Answer
Answer A. At least at each financial year end
Q207: Under IAS 16 if an asset is idle
- A. Depreciation is paused
- B. Depreciation for the entire period does not apply
- C. Depreciation is ignored
- D. Depreciation continues
Answer
Answer D. Depreciation continues
Q208: Which of these is an allowable cost of an asset under IAS 16?
- A. General overheads
- B. Professional fees
- C. Administration expenses
- D. General overheads
Answer
Answer B. Professional fees
Q209: What is the net amount an entity expects to obtain for an asset at the end of its useful life?
- A. Depreciated value
- B. Residual value
- C. Present value
- D. Fair value
Answer
Answer B. Residual value
Q210: Under IAS 16, which of the following is not allowable as a directly attributable cost of a machine?
- A. Delivery
- B. Site preparation
- C. Estimated dismantling costs
- D. Initial test batches
Answer
Answer D. Initial test batches
Q211: What is the amount an asset could achieve if sold between knowledgeable, willing parties in an arm’s length transaction?
- A. Current value
- B. Net present value
- C. Written down value
- D. Fair value
Answer
Answer D. Fair value
Q212: A company purchases land with an office building. The building has a useful life of 20 years. How should the land be depreciated?
- A. Depreciate over useful life of the land
- B. Don’t depreciate the land
- C. Valid
- D. None of these
Answer
Answer B. Don’t depreciate the land
Q213: Which of the following is covered by IAS 16 Property, Plant and Equipment?
- A. Office buildings
- B. Assets held for sale
- C. Exploration assets
- D. Biological assets related to agricultural activity
Answer
Answer A. Office buildings
Q214: Which of the following disclosures is not required when an asset is revalued?
- A. Name of valuer
- B. Revaluation surplus
- C. Effective date of revaluation
- D. Whether valuer was independent
Answer
Answer A. Name of valuer
Q215: Under IAS 16, which two subsequent accounting treatments are allowed subsequently to initial recognition?
- A. Cost model and present value model
- B. Cost model and revaluation model
- C. Fair value model and revaluation model
- D. Fair value model and cost model
Answer
Answer B. Cost model and revaluation model
Q216: When an asset is sold or disposed of, where is the gain or loss recognised?
- A. Asset disposal account
- B. Profit and loss
- C. Revaluation reserve
- D. Depreciation
Answer
Answer B. Profit and loss
Q217: Which of the following is not a component of cost of an asset?
- A. Purchase price
- B. Refundable sales tax
- C. Import duties
- D. Estimate of compulsory future dismantling cost
Answer
Answer B. Refundable sales tax
Q218: A change in depreciation method is a
- A. Change in accounting policy
- B. Change in accounting estimate
- C. Change in accounting method
- D. Change in accounting standard
Answer
Answer B. Change in accounting estimate
Q219: When an item of property, plant and equipment is revalued, what should be revalued?
- A. A selection of assets decided by management
- B. A selection of assets picked at random
- C. The whole class of assets to which it belongs
- D. The individual asset
Answer
Answer C. The whole class of assets to which it belongs
Q220: Under IAS 16, if assets are exchanged in an arm’s length, commercial transaction, their value will be measured at
- A. Written down value
- B. Fair value
- C. Carrying value
- D. Net present value
Answer
Answer B. Fair value
Q221: Which of the following is not an asset that falls under the scope of IAS 16?
- A. Assets held for sale in the normal course of business
- B. Tangible assets
- C. Assets expected to be used for more than one period
- D. Assets held for the production or supply of goods or services
Answer
Answer A. Assets held for sale in the normal course of business
Q222: How should an asset be initially recognised in the financial statements?
- A. Measure at market value
- B. Measure at cost
- C. Measure at net realisable value
- D. Measure at fair value
Answer
Answer B. Measure at cost
Q223: Where is the amortisation of an intangible asset recognised?
- A. Equity
- B. Profit or Loss
- C. Statement of Financial Position
- D. Statement of Cash Flows
Answer
Answer B. Profit or Loss
Q224: What is the initial recognition measurement of an intangible asset?
- A. Fair value
- B. Net present value
- C. Cost
- D. Market value
Answer
Answer C. Cost
Q225: When an intangible asset is sold, the gain or loss is recognised
- A. in Equity
- B. in the Profit or Loss
- C. in the Statement of Financial Position
- D. in the Statement of Cash Flows
Answer
Answer B. in the Profit or Loss
Q226: Which of the following is not a requirement to capitalise development costs under IAS 38 Intangible Assets?
- A. The commercial feasibility for the asset may be uncertain
- B. It must be technically feasible
- C. The entity intends to sell the completed intangible asset
- D. The entity can demonstrate how the asset will generate future economic benefits
Answer
Answer A. The commercial feasibility for the asset may be uncertain
Q227: An intangible asset with a finite useful life should be amortised over
- A. A period determined by management
- B. Five years
- C. Its expected useful life
- D. No foreseeable limit
Answer
Answer C. Its expected useful life
Q228: What are intangible assets?
- A. Nonmonetary assets without physical substance
- B. Monetary assets without physical substance
- C. Monetary assets with physical substance
- D. Nonmonetary assets with physical substance
Answer
Answer A. Nonmonetary assets without physical substance
Q229: How often should the useful life of an intangible asset with a finite useful life be reviewed?
- A. Every year
- B. Every six months
- C. Every five years
- D. At managements discretion
Answer
Answer A. Every year
Q230: Which of the following is an intangible asset under IAS 38?
- A. Patent rights
- B. Market share
- C. Customer loyalty
- D. Technical knowledge training
Answer
Answer A. Patent rights
Q231: Which of the following measurement models is not permitted for the subsequent measurement of intangible assets under IAS 38?
- A. Revaluation model
- B. Fair value model
- C. Cost model
- D. Capital Assets pricing model
Answer
Answer D. Capital Assets pricing model
Q232: Which of the following is not an example of an intangible asset?
- A. Cash in bank
- B. Customer lists
- C. Trademarks s
- D. Software patents
Answer
Answer A. Cash in bank
Q233: Which of the following is not an example of investment property?
- A. Land held for undetermined future use
- B. Property leased to another entity under an operating lease
- C. Property leased to another entity under a finance lease
- D. Property being constructed for future use as an investment property
Answer
Answer C. Property leased to another entity under a finance lease
Q234: If an entity wishes to change from a cost model to fair value model under IAS 40 Investment Property, when may it do so?
- A. When a change will result in a more appropriate presentation
- B. When the board of directors approves a change
- C. When the value of the assets will improve with a revised model
- D. When the market for these properties is fluctuation
Answer
Answer A. When a change will result in a more appropriate presentation
Q235: If an entity uses part of a building for their own use, and rents the remainder. How should this be treated?
- A. All as investment property under IAS 40 Investment Property
- B. All under IAS 16 Property Plant and Equipment
- C. Account for separately under IAS 16 Property Plant and Equipment and IAS 40 Investment Property
- D. None of these
Answer
Answer C. Account for separately under IAS 16 Property Plant and Equipment and IAS 40 Investment Property
Q236: An investment property should initially be measured at
- A. Cost
- B. Market value
- C. Fair value
- D. Net realisable value
Answer
Answer A. Cost
Q237: Which of the following is not a transfer from or to investment property under IAS 40
- A. Commencement of owner occupation
- B. End of construction of development
- C. Commencement of development with a view to sale
- D. Transfer from undetermined use to an operating lease
Answer
Answer D. Transfer from undetermined use to an operating lease
Q238: Under IAS 36 what is the recoverable amount of an asset?
- A. The lower of its cost and net realisable value
- B. The higher of fair value less costs of disposal and value in use
- C. The lower of net present value and cost
- D. The higher of net present value and cost
Answer
Answer B. The higher of fair value less costs of disposal and value in use
Q239: How often should a cash generating unit to which goodwill has been assigned, be tested for impairment?
- A. Every year
- B. At managements discretion
- C. Every six months
- D. As often as practicable
Answer
Answer A. Every year
Q240: What is the treatment of an impairment loss under IAS 36?
- A. Record it in Equity under Revaluations
- B. Write it off against profit over a defined period agreed by management
- C. Record a liability in the SOFP for Impairment losses
- D. Write it off against profit immediately
Answer
Answer D. Write it off against profit immediately
