t lllr foll11win11 •h11,·111r111, pl'rtnl11 to thr pt0vl1l11n1 ol I '11111·~1~1111I h 11111rw11rk un the con,;rph 111 <'1plt• I M"httn,Mn<,

Sr,,,,.,,.,n, I. I hr prindpnl <lllfrrt'n,·r ill'lwrr11 twn corrcrpb of rnpllnl 111nh1l11111111<c " 11,c '"'"tmer,t ,,r tl,r clte<..t, ul
rhn1111r, In thr prkc~ 11fn,,01, nn<I llnhlllty ufthc rutlly.
Stalt'1'1t'nl //: l11r .,rlt·1·tlot1 of the nppruprinll' co11crpt of cnpllnl hy n11 ctrlily ~hould he h• v1I 011 rl1t 11ee1h ,,, 1hr uw:n
or It, llnnndnl ~,a11·111c111~.
S1,,,,,,,.,n, Ill: '1111· ro11ccpl of coplrnl 11111l11ten11ncc d10,r11 hy 1111 unlily 1<111111 d0ti,r111lr1• tlu~ 11u.01111t11111. rrul<kl u~ I ill
the prepnnlflun ol its lhmncl11I sl11lr111c11t,.
11. None ol' the fo!l'golnit sl11t1·1111•11rs is folsc
b. Only stnll'111r111 I is litl,c
c. Only 5hll1·1111•11t II i~ litlsr
d. Only stnh·1111·nt Ill Is li1lsc
2. One element of thr objective of linn11ci11I rcportinit I~ lo provide:
n. infom111tion thnt i~ uscf\1I In n,,o,sing cn~h flow pm~pccls.
b. infom1nti,11111bnut the llquldnlion vulucs of the resources held hy the cntorprl~e.
c. informotion nbout the Investor.. In the business entity.
d. information thnt will nttmct new investor,.
3. The objective of finnnciol reporting in the Conceptuul Frornework for Finuncinl Reporting:
a. ls the foundntion for the Fmmcwork.
b. Includes the qualitative chnracteristics thnt rnukc accounting infonn11tinn useful.
c. Is found on the third level of the Framework.
d. All oft.he choices are correct regarding the objective of linoncinl reporting.
4. Application of the foll disclosure principle:
a. is demonstrnted by the use of supplementary information cxplnining the effect..~ of financing
arrangements.
b. is theoretically desirable but not practical because the costs of complete disclosure exceed the benefit~.
c. is violated when important finnncial infonnation is buried in the notes to the finuncial statement,.
d. requires th11t the financial statements be consistent and compnrnblc.
5. Which of the following is a benefit of providing financial infonnntion?
a. Improved allocation of resources.
b. Potential litigation.
c. Auditing.
d. Disclosure to competition.
6. l11e Internationol Accounting Standards Board's {IASB) Conceptual Frnrncwork _ __ _ _
a. excludes the concept of prudence or conservatism because it is inconsistent with neutrality, which
encompasses freedom from bias.
b. includes the concept of prudence or conservatism which means when in doubt, choose the solution
that will be least likely to overstate assets or income and/or understate liabilities or expenses.
c. includes the concept of prudence or conservatism which means when in doubt, choose the solution
that will be least likely to understate assets or income and/or overstate liabilities or expenses.
d. Includes the concept of prudence or conservatism as a desirable. but not required. quality of financial
reporting information.
7. In which section of the Statement of Comprehensive Income is Financing Cost reported?
a. Income from continuing operations
b. Gross profit
c. Income from operations
d. Non-controlling interests
8. Which of the following should be disclosed in a "Summary of Significant Accounting Policies?"
a. Depreciation method followed -.
b. Types of executor contracts
c. Amount for cumulative effect of change in accounting policy
d. Claims of equity holders
9. According to PAS I, which of the following are NOT commonly required disclosures of accounting policies?
a. personnel involved in drafting the summary of significant accounting policies or, including those who
made the judgments and estimations
b. the measurement basis or bases used in the financial statements
c. disclosures required by other IFRSs, like the rensons why the entity's ownership interest does not
constitute control
d. the nature of a company's operations and the policies that the users of its financial statements would
expect to be disclosed for that type of entity
10. The accountant of John Company is preparing the Statement of Comprehensive Income and Statement of Financial
Position at December 3(, 2014. The January I, 2014 merchandise inventory balance will appear:
a. Only in th~ cost of goods sold section of the statement of comprehensive income
b. Only as an nsset on the statement of financial position '
c. As a deduction in the cost of goods sold section of the statement of comprehensive income and as a
current asset on the statement offinancial position
d. As an nddition in the cost of goods sol~ section of the statement of comprehensive income and as a
current asset on the statement of financial position
I of 11
 ..
I I. Th(- Stat~mtnt of I in11nriRI Pmith•n ~h11II d ft!,l fy onr of thr~e 115 11 non-current S\~rl.
•· Ca.,h fun1h ~ a.,ide for pavmenl of tquipmcnt lo be delivered a month after lht reporting period
h. G00\1' \\hich Art' in proct!5 of production for ,ale in the ordinary coune of bu~ine,s
c. Dtbt Md ,-quity ,l'CUritir, acquired princip11lly for lhe purpose of gcnrrarlng a profit from short-term
Ouct111tion5 in rric-e or dt11lrr', margin
d. Amounl3 tlue from cu,rome~ within a period of 12 lo 18 months. extended within the usual credit
tl"mls of the rnterpri,e
12. Thf di,clo,ure of accounting policic5, i5 import11111 to financial statement readen in determining:
a. whether accounting policies ere consistently applied from year lo year.
b. net income for the year.
c. the VJlue of obsolete items included in ending inventory.
d. whether lhe working capital position is adequate for future operations.
13. The full d_isclosurc principle, as adopted by the accounting profession, is besl described by which of the following?
a. D1sclosurc of any financial facts significant enough to influence the judgment of an informed reader.
b. All information related to an entity's business and operating objectives is required to be disclosed in
the financial statements.
c. Information about each account balance appearing in the financial statements is 10 be included in the
notes to the financial statements.
d. Enough information should be disclosed in the financial statements so a person wishing to invest in
the shares of the company can make a profitable decision.
14. PAS I presents two alternative methods of classifying expenses in the income statement within the Statement of
Comprehensive Income. Which of these statements is/arc correct?
Statement I: Additional disclosure is required for the function of expense when the nature of expense classification is
used.
Statement II: Additional disclosure is required for the nature of expense when the function of expens~ classification is
used.
a. II only
b. I only
c. Both I and II
d. Neither I nor II
15. Which of the following is a non-current liability on December 31, 2014 statement of financial position?
a. Mortgage note payable due March 15, 2015, in which the entity has the intention and discretion to roll
over for a period of at least 24 months from the original maturity date
b. Bonds payable maturing on March 2015 which were refinanced in 2015 before issuance of the 2014
financial statements
c. Mortgage note payable due March 15, 2015, which was rolled over in 2015 after the issuance of the
2014 financial statements
d. Mortgage note payable due March 15, 2015, which was converted into shares of the company's
ordinary share capital in 2015 before the issuance of20l4 financial statements
16. PAS I requires the following items to appear on the face of the Statement of Changes in Equity:
I: The net amount of cash from the issue of any securities during the period
II: The cumulative dfect of changes in accounting policy and the correction of errors
III: Total comprehensive income for the period
JV: Profit or loss for the period
a. Il, III, and IV
b. II and IV only
C. J, m and JV
d. J,11,III and JV
17. A journal entry to record expenses out of the petty cash fund shall be done:
a. Upon replenishment
b. Upon disbursement
c. At the end of the period
d Whenever the entity wishes . .
18. When· a customer returns merchandise for a cash refund, the seller enters the transaction m the
a. Cash payments journal
b. Sales joumal
c. General journal
. • I
d. Cash receipts JO_urna d. I ed within the income statement for:
19. PFRS 5 requires that a smgle amount ~e rs~ os d rations and the post-tax gaiJJ/loss on the disposal of
a. the post-tax profit/loss on drscontmue ope ' •.
discontinued operational asse~- . d erations and !he pre-tax gain/loss on the disposal of
b. the post-tax profi~oss on d1scontmue op . I f
discontinued operational assets. . . d the post-tax gain/loss on the d1sposa o
the pre-tax profit/loss on discontmued operations an .
c. discontinued operational asse~. . tions and the pre-tax gain/loss on the disposal of
d. the pre-tax profit/J~ss on discontinued opera
discontinued operational assets. 2 of I I
~() Whkh of the follllwln11 n,ljustlng enlrlrs will NOi nlTerl bolh 1hc h"l1111cc sheet nnd income statement?
11· None of lhc c:hoicrs, both slntcmcnts nrc uffrclrd by 11djusl ing joumul entries
b. Accmed income
c. llrcp11:,,mcnts uslnK the expense method
d. llneamrd income using the liability method
21. Rrvcnues are:
B. A subdi,·i~ion of equity, providing information about why eq~ity increased. .
h, lmpncted by debits nnd credits in the some way that expenses are impacted by debits and credits.
c. Reported on the statement of financial position as a current item.
d, All of the choices arc correct.
22, TI1c double-cntiy accounting system means:
a. The dual effect of each transaction is recorded with a debit and a credit.
b. Each transaction is recorded with two journal entries.
c. Each itctn is recorded in ajournal entry, then in a general ledger account. ~
d. More than one of the above.
23. In a normal sale, what is generally the most uncertain factor in revenue recognition process?
a. The reolizability of the resource or item to be received by the seller
b. The relevance of the resource or item received by the seller
c. The seller's fulfillment of its responsibility in the transaction
d, The mensurdbility of the resource or item received by the seller
24. Limitations of the income statement include all of the following, EXCEPT
a. Only actual amounts are reported in determining net income.
b. Items that cannot be measured reliably are not reported.
c. Income measurement involves judgment.
d. Income numbers are affected by the a~ounting methods employ_ed. al
25. The term 'layaway sales' applies to transacnons where goods arc delivered only when the ~uyer makes the fin
payment in a series of installments. Under PAS 18, revenue from such sales is generally recogntzed when:
a. the goods are delivered
b. the first installment is made
c. the final installment is made
d. the substantial payment is made
26. The income statement information would help in which of the following tasks?
a. Estimate future cash flows.
b. Evaluate the liquidity of a company,
c. Evaluate the solvency of a company.
d. Estimat~ future financial flexibility.
27. Which of the following is an example of managing earnings down?
a. Revising the estimated life of equipment from 10 years to 8 years.
b. Changing estimated bad debts from 3% to 2.5% of sales.
c. Not writing off obsolete inventory.
d. Reducing research and development expenditures.
28. Which of the following is an example of managing earnings up?
a. Underestimating warranty claims.
b. Decreasing estimated salvage value of equipment.
c. Writing off obsolete inventory.
d. Accruing a contingent liability for an ongoing lawsuit.
29. What might a manager do during the last quarter of a fiscal year if she wanted to improve current annual net income?
a. Relax credit policies for customers.
b. Increase research and development activities,
c. Delay shipments to customers until after the end of the fiscal year.
d. Delay purchases from suppliers until after the end of the fiscal year.
30. The results of discontinued operations should be presented as a single amount in the:
a. income statement, after tax, separately from income from continuing operations.
b. income statement, before tax, separately from income from continuing operations.
c. statement of changes in equity
d. statement of financial position and in the notes thereto
31 . Under PFRS 5, which criterion does not have to be met in order for an operation to be classified as discontinued?
a. The operation must be sold within three months after the balance sheet date
b. The operation should represent a separate line of business or geographical area
c. The operation is a subsidiary acquired exclusively with a view to resale
d. The operation is part of a single plan to dispose of a separate major line of business or geographical
area
32. PFRS 5 defines a "disposal group" (i.e., that will be disposed through sale) to include:
a. current assets, non-current assets and some directly associated liabilities
b. non-current assets only
c. current and non-current assets
d. non-current assets and some directly associated liabilities
3 of 11
11 Wlwn Ille <Jlf?)'l" I . ,,,,_,"' ,,t 1 "'"' u 11rnrt 1, .-.1 d au tfwl '" hckl l•,r 1,1k u,IO(-f f>I R~ s i • lowct 1_h111 ,u fair valU<'
'-" l< -4t h, ..11 , U.. n
I r,,, lmr1Slr m, ht 111. . "'·' Ull
h llnJ'll l,r,w,n, ''"' , hall I-.: rtult(T1l1u l III fJf"fit '" i.~,
l'"f"'lrm,nt ''"' , hall lw rro.,/!I IL•I Ill r.llhn l,impn:hotn\l\lc lri(OnM:
,t lm,,.lr,n(' rll iui •n '1,111 hr, rll\< l•"-''1 In th.t 011•.n 11, ttw: fin.arx.,ail ~ m, 11t•
1• I tt tmatu .,, f\,tu,, , ...ti 11,,.., l•lf put'Jl'-1 of v,mpv11n11 valuc•tn-uK under I' A<; 36 oonnally 11,ould cover
ri••l l'<. ll,,n111v,, • ,,.o lm,,m J)'!' t•11l ,,I 111,w many y= 'f{I
I IV• y11n
h I •n yea"
,. I 10,:.:11 yc11n
cl I wt.nty yr.11"
1' 1111,ter ~I< : 12, any ,_,,., lnuirrc,I In 1lcvcl1.1p II W,:t, \11.c for f)IIT'Jl'>"ie'I of promoting company productl illld SCTVices
t h1II llC
n. fap,:nvAI I,, 11!,: pcr-1•"1 lrw.urrctl
t,, C:11plt~ll 1r<I ~rul tutc<l l•H' irt'IJ)llirmmt
c. <:ap11all1J:<I ar,rl unr,nl1r.d (JVCT ~ ycan
cl C:npltflll11:1I rmtl 11rnrJr1l1,:tl nvcr Ill ycan
)(, . 11,...., I, • 1!11,nll\c.11 111 ""''"'"' of um~i(9uncnt inventory reported in the 5tat.emcnt of financial position?
11. 'fhc lnvcnt,rry 1, rcpo,tcd )CJY.r41.tly on the con.signo(s ~ t of financial position.
h. '1hr. Inventory I\ comhlned with llther inventnry on the consignor's Sl.111:ment of financial position.
c. ·r hi: Inventory h r"f)'lftA:tl tqY,mm:ly vn the con.sign«', Slalffllent of financial position.
d. Hie lnvcnt1,ry 1, C1rrnhlned with ,J!hcr inventory on the consignee's sw.t>ment of financial position.
17. Whr.n lnvcn!Jrry I, 111i~~IJl!cd, it~ pre">erlUstion la.clu:
11. 1'11lthl\1I reprc•.cnt:iti,m.
h. J<clcvancc.
c. (;1,mp11r:1hility.
d. AII ,,f' the d,olcc~ arc ccrrrect.
JK. To he C(m~lw~nt wl1ti the hi~tJll'ical a~ principle, overhead ~ incurred by an enterprise constructing its own
hulldlnst thoultl he:
:i. allocated rm rt pro rat;, bali, between the as~ and normal operations.
h. rtll1,c1ted "n the ha.~i• of llttlt production.
c. 1:llmina1ed o,mplt:t.ely from the CO'lt of the as~.
ii. 11ll11tat1:tl 1,n an opponunity cmt basis.
)9, l1or rt non-rn,mct;,ry exchange of plant a,'>CU, accounting recognition should NOT be given to:
11. 11 w,in when the c-i1change ha, no commercial suMtanee.
h. n lo,~ when the exchange ha! no commercial substance.
c. 11 w,ln when the exchangc ha, commercial substance.
d. rt loA~ when the c:xchangc ha, CC>mmcrcial substance.
<I(). Which of the followin g C(~ in01rred internally to create an intangible asset is generally expensed?

11. l(e,carch plit1-'IC CO'lt,.

h. PIiing cmth.
c. l..eg1tl COM~.
d. All of rhe~.c choice, are correct.
41. Amorti;,.cd co11t ia the initial rtc0gnition amount of the investment minus:
a. repayment·, plus or minus cumulative amortiwion and nel of any reduction for uncollectibility.
h. rcpaymenl~ and net of any reduction for uncollectibility.
c. cumulative am<Jrti1.ation and net of any reduction for uncollectibility.
d. repayment~ pluA or minus cumulative amortization.
42. AII of lhe following arc examples of a provision, EXCEPT:
11. Advanced receipt of sub1cription
h. Envlronme11tal contamination
c. Warranty and guarantee
d. Pendlnv. court C3llC
43. PAS 19 requlrcA sh,,rt-term employee benefits to be measured at:
a. Nominal value
h. l'rc,icnt v11l11e
c. Pair value
d. Future value
44. Where iA debt callable hy the creditor reported on the debtor's financial statements?
a. Current liability.
h. Non-current llahility. . _ .
c. Current Ji11 hility if the creditor int.ends to call the debt within the year, otherwise a non-current
llobility. . h' th h · t
d. Current lluhillty If It i~ probable that creditor will call the debt wit in e year, ot erwlSC a non-curren
ll11hlllty.
4 of 11
 4
' 1'laf rnlnirnurn lr..r
1 C f\ll)'flirnl I, dr finc,I •• lncludlnl( oll 11r the fullowlnl( ~11n1p1111r 11t, r Xn•r•·r
onnn1rn1 ~nlal, · ·
b Bll')tlin p11rcha1t option
c. Gllhntcro residual value
,. T d. Leu r pa,meno occurring over lca,e lenn
6 0
rttord an rnvironmrntal liability, the co,11.w,clelrd with the liabil ity i, :
l. Incl uded 1n the CIIIT)'ing nmounl of the rdntcd lonii-llved u.-el.
b. expni~d
c. included in a separate accounl.
d. None or the~ answer choic~ are correct.
47
A company is le(!ally obligated for the costs a.uocialed with the retirement of n lonit•lived n.,-,ct
'- whether II him another party lo perfonn the retirement activities or performs the ~ctivilic, it'ICJf.
b. only when ii hires another party lo perfom1 the retirement ac1ivi1ies.
c. only if i1 performs the ac1ivilie5 with ii! own workforce and equipmenl.
d. only when the obligation ari!><:5 al lhe outset of the asset's use.
48. What condition is necessary 10 recognize an environmental liability?
L Company has an existing legal obligation and can reasonably estimate the amount or the liability.
b. Company can reasonably estimate the amount of the liability.
c. Company has 11n existing legal obligation.
d. Obligation event has occurred.
49, A debt instrument with NO ready market is exchanged for property whose fair value is cum."lltly indeterminable.
When such a transaction takes place:
a. the p!e$Cnl value of the debt instrument musl be approximated using an imputed in1eresl rate.
b. it should not be recorded on the books of either party until 1he fair value of the property becomes
evident
c. the board of directors of the entity receiving the property should estimate a value for the property thal
will serve as a basis for the transaction.
d. the directors of both entities involved in the transaction should negotiate a value lo be assigned lo the
property.
50. In a debt extinguishmenl in which the debt is continued with modified terms and the carrying value of the deb! is more
than the fair value of the debt
a. a gain should be recognized by the debtor.
b. a loss should be recognized by the debtor.
c. a new e!Tc:ctive-interest rate must be computed.
d. no interest expense should be recognized in the future.
51. Long-term debt that matures within one year and is to be converted into shares should be reported:
a. as non-current if the refinancing agreement is completed by the end of the year.
b. as a current liability.
c. in a special section between liabilities and equity.
d. as part current and part non-current.
52. Retained earnings are a component of:
a. Reserves
b. Other equity
c. Contributed equity
d. Comprehensive income
53. Whether a dividend is paid by a company depends on the decisions made by the:
a. Directors of the company
b. Auditors of the company
c. Creditors of the company
d. Shareholders of the company
54. Under IFRIC 17, noncash asset distribution to owners like property dividends should be recognized as
a. A liability based on the fair value of the asset to be distributed
b. A liability based on the carrying amount of the asset to be distributed
c. A direct deduction from share capital
d. An appropriation of retained earnings
55. Which of the following is NOT a reason that companies may undertake a share buy-back?
L As a defense against a hostile takeover
b. As a way to efficiently manage surplus funds
c. To increase the worth per share of the remaining shares
d. To manage the capital structure .. ' .
56. Any errors or adjus!Tllents resulting from changes in accounting policies Iha! are accounted for retrospectively
requires:
a. A retrospective adjustment to both basic and diluted earnings per share
b. No retrospective adjustment to either basic or diluted earnings per share
c. A retrospective adjustment to basic earnings per share only
d. A retrospective adjustment to diluted earnings per share only

5 of 11
n . l',,r thr pu11•o~r• ,,t' calculntin(! 1lll~tcd El'S, un entity. shnll ndJust the profit auributnble to ordinary shareholder.. by
tht 11\tt-hl\ ('tTrn Clf tho following 11c111(s} re luted to d1lulivc potcntiHI ordinary shares:
11. Dlvidrnd,, i111crc~t. nlhrr income or expenses
l't. lnt1·1cst ,111ly
,·. Dlvl,lrnds only
d. Other inrnmc or cxpcnscs only
~S. A "secret n-scrvc" will be crcnted Ir:
A. 11 cnpit11l cxpcnditurc Is chnrged 10 expense.
b. inndrqunh: ,lrprecintion is churgcd lo income,
c, linbilitics nrc undentaled.
d. shnrchoh.lcrs' equity Is overstated.
~9 • Whrn treasury shnrcs 11rc purchased for more than the par value or the shares and the cost method is used to account
for trcnsury shnr.:s, whnt nccount(s) should be debited?
n. Trcnsury shurcs for the purchase price.
b, Trcasury shares for the par value and share premium for the excess or the purchase price over the par
value.
c. Shure premium for the purchase price.
d. Treasury shares for the par value and retained earnings for the excess of the purchase price over the
pnr vuluc.
60. Which of the following best descri~s a possible result of treasury share transactions by a corporation?
n. May decrease but not increase retained earnings.
b. Mny increase but not decrease retained earnings.
c. May incrt!ase nrt income if the cost method is used.
d. Mny decrease but not increase net income.
6 I. Which of the following fentures of preference shares makes the security more like debt than an equity instrument?
a, Redccmnblc
b, Panicipttting
c. Voting
d. Noncumulative
62. The cumulative foature of preference shares:
a. requires that preference dividends not paid in any year must be made up in a later year before
dividends are distributed to ordinary shareholders.
b. limits the amount of cumulative dividends to the par value of the preference shares.
c. means that the shareholder can accumulate preference shares until it is equal to the par value of
ordinary shares at which time it can be converted into ordinary shares.
d. enables a preference shareholder to accumulate dividends until they equal the par value of the shares
and receive the shares in place of the cash dividends.
63. Redeemable preference shares should be:
8. included as a liability.
b. included with ordinary shares.
c. excluded from the statement of financial position.
d. included as a contra item in shareholders' equity.
64. Cumulative preference dividends in arrears should be shown in a corporation's statement of financial position as:
8. a foomot~.
b. an increase in current liabilities.
c. an increase in equity.
d. an increase in current liabilities for the current portion and non-current liabilities for the long-tenn
ponion.
65. The features most frequently associated with preference shares include all of the following, EXCEPT
a. Callable at the option of the shareholder.
b. Convertible into ordinary shares.
c, Non-voting.
d. Prefertnce as to assets in the event of liquidation. .
66. When preference shares share ratably with the ordinary shareholders in any profit distributions beyond the prescnbed
rate this is known as the:
a. Participating feature.
b. Cumulative feature.
c. Callable! feature.
d Redeemable feature. _ .
7, Whi~h of the following events occurring after the reporting period (Le., subsequent events) would rcqwre adJustments
6
in the financial statements? . . · d. ·
_ Loss on an uncollectible trade receivable as a result of a customer's detenoratmg financ1a1 con 1tmn
8
leading to customer's bankruptcy subsequent to balance sheet date
b. Purchase ofan existing business
Decline in net realizable value of inventory as a result of fire
~-- Sale of a bond or share capital planned before the balance sheet date
6 of 11
"1 liqutdat di,i\~k
._R~ •m..•1.1n1, "" 1I ,
~ ""' ~~ •- , -•n hv •h• 1.-l11,l,lr"
1 • ,. ,,t-ut'tl 1t111k1 l'I R<;
c R""u 1
. .., II'\' n'!'d tl lo ShA1-r CApitnl ·
d A ll t' ( thM ·II<,
f,Q A . . <" l ll'C'I 1 11' COITN"I
m1n1"1 C'\'ffll'l.11, J.... I ~ A Ii . I . . .
I. Shill'\' ~ •llm q1111 nrin~ d11 idrnd. Thr Jo11mAI r11 lr)' lo rl'cord rhc ded~r:oliHn m11\I lntludt ~ <khir '"
b . . .
Rt1a1~ E..arning,.
c. AC'CUmlllnll'd l)c,plt1ion.
d.. AC'CUmula1rd l~i11ion
"O. \\ ltich ~ of the follu~i n · · . ~-
l'Mbcr th . th S disclosures should be mnde in lhe c4ui1y \eclion of rhe .~lalernenr nf financial p<A rti<m
a.n in e notes 10 the financial s1a1emenl5? ·
L Liquidatioo prrferences
b. Di,'idnid r,efn-cncc.-s
C. Call pri~
. d.. Con ,'l"rsion C'II' exc.-rcise price-s
71 · Di\idcnd5 are l'-OT paid on:
L trt3sur.• shares
b. ~ u l a1i1e.prefn-ence sharc.-s.
'- nonparticipating preference shares.
d. all of the.- chc>icc.-s.
72. Noncumulati~ prc.-imed di1•idc.-nds in arrears:
L are not paid or disclosed.
b. must be paid before any other cash dividends can be distributed.
c. are disclosed as a liability until paid.
d. are paid to preference shareholders if sufficient funds remain after payment of the current preference
dividend..
TI. Convertible bends:
a. Allow a company to issue debt financing at cheaper rates.
b. Arc sq>arated into the bond component and the expense component.
c. Arc separated into their components based on relative fair values.
d. All of the choices are correct
74. 'The conversion of preference shan:s into ordinary shares requires that any excess of the par value of the ordinary
shares issued o~er the carrying amount of the preference shares being convened should be:
a. treated as a direct reduction of retained earnings.
b. reflected cu=ntly in income.
c. reflected currently in other comprehensive income.
d. treated as a prior period adjustment
75. Wben the cash proc~ from bonds issued with detachable share warrants exceed the fair value of the bonds without
the warrants, the excc.-ss should be credited to _ __
a. Share Premium-Share Warrants.
b. Share Premium-Ordinary.
c. Retained Earnings.
d. A share liability account
76. The major difference between convertible debt and sbare warrants is that upon exercise of the warrants:
a. the holder has to pay a cenain amount of cash to obtain the shares.
b. the shares are held by the company for a defined period of time before they are issued to the warrant
holder.
c. the shares involved are restricted and can only be sold by the recipient after a set period of time.
d. no share premium can be a pan of the transaction.
77. The date on which ro measure the compensation element in a share option granted to a corporate employee ordinarily
is the date on which the employee:
a. i5 granted the option. .. _
b. has performed all conditions precedent to exerc1smg the option.
c. may first exercise the option.
d. exercises the option. _ _ .
78. The date on which rot.al compensation expense is computed ma share option plan 1s the date:
a. of grant.
b. of exercise.
c. that Lie market price coincides with the option price.
d. that the market price exceeds the option price. . , .
79. The statement of cash flows provides answers to all of the following quesuons, EXCEPT:
a. what is the impact of inflation on the cash balance at the end of the year?
b. where did the cash come from during the period?
c. what wa., rhe cash used for during the period?
d. what wa.~ the change in the cash balance during the period?

7 of 11
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c. The llch•rminn!l1111 ntlcr 1hr 1r1111rlillJ1. fiOl'iml or 1hr 1.11,1 11I n•~r,I• p1111:lt11~1I, 111 It.,: r11 'i<A'~'
n,,rts •old, bcfnro tho cml 111' lhn l'Of111lll1111. per 1111I,
d. the dctc1111h1n1lon nllrr lhc rcp11r1l1111. l'nrl11d nl lho 11111111111I 111 proll1,, h11rirrv, ,,, f11rr1ut pi,yrn,mt, , ,f ti,,.
entity 111111 n prc,cnl loy,nl or conAlntcllVl' 11hll11,11lh111 nl 1hr rml 11I tltr, rr.portinv, pr.rlt,d 1,, m1tlu: ,u,.h
pnymcnt, n, n rc.i1l1 of ovcnln hcli>rc lhnl 111110
86. llndcr PAS 24, nil of the fnllowlnit rue conNhloroil 111 ho NC ff ncco•nrlly rclntr.11 p11r1lc~ 111 tltc rcpt,rtln1t trrl.ity ,
EXCEPT
n. Post-employment bcncl11 plnns
b. Providers of linnnco
c. Publk utilities
d. Trndc union,
87. Under Pf'RS R(Opcrnling Segments), "Mnjor Customer" dlscl11Nurc1, lnchulc ;111 ol !Ito lotlowinv~ EXU:l"I
a. The idenl ity of the mnjor cuslomen
b. Totnl nmllunl of revenue from mnjor c11, lorno111
c. The fnct lhnl the entity relics on mnjor customers
d. The identity of the segments reporting the rcvenuo from major ctmlomerN
88. The statement of cash flows reports all oflhc following, EXCEPT:
a. the free cash flows genemled during the period.
b. the net change in cash for the period.
c. the ca~h effects of opemtions during the period.
d. investing trnnsactions.
89. !fa business entity entered into certain related pnrty lrnnsactions, it would be required t() di'ICIW!C all of the following
information, EXCEPT:
a. nature of any future transactions planned between the parties and the terms involved.
b. nature of the relationship between the parties to the tranNaction~.
c. peso amount of the transactions for each of the periods for which an income statcmenl is presented.
d. amounts due from or to related parties as of the date of each statement of financial P°'ition presented.
90. Events that occur aIler the December 31, 2014 statement of financial position date (but before the statement of
financial position is authorized to be issued) and provide additional evidence about condition., that eximd at the
statement offinancinl position date and affect the rcalii.ability of accounts receivable should be:
a. used to record an adjustment to Accounts Receivable at December 31, 2014.
b. discussed only in the Management commen\ary section of the annual report.
c. disclosed only in the Notes to the Financial Slatcments.
d. used to record an adjustment directly to the Retained Earnings account

8 of 11
91. Companie-, shool,t di,c~ all of thl- follo"'ini in incenm rcporu. EXCEPT:
L belanc-t in account, ~ ivablc.
b. dividcn,h paid.
C. ChanJC.' In ac«'Unting polici~.
d. tea.'IOl131 re, muc, co,t, Of expc-nse1.
92. A wgmcnt ofa b,uinus m t ~ is 10 be rq,oned separa!cl} ,.h(n [h( rc,en~ of the scgmen1c\Cccd 10". of the.
a. total rt,cnues of all the m t ~'s industr)• segmmu.
b. total combined ~cnun of all 5eg111cnll reponing protiu.
c. total expon and foreign sales..
d. combineJ net income of all ~nts reporting profits.
93. All of the follow ing information about each opcnting ~mt mUSI be rc-poned. EXCEPT:
a.. C05l of goods 501d.
b. unusual item5.
c. intern! revenue.
d. dq,reciarion and amortim:ioo expense. . .
94. Which of the following subsequent events would gC'llffally require disclosure. but NO adJustment of the- financutl
statements?
a.. luue of a large amount of ordinary shares.
b. Retirement of the company president •
c. Settlement of litigation when [h( event that gave rise to the litigation occurred prior to the- Sllltemcnr 01
fi11211cial position date.
d. Employc-= ~aikes
9S. A b11$ineM combination is defined .u a transactioo in which:
a.. an xqu1n:r obuins control of one or more: businesse-s
b. an acquirer obuins cootrol of an .xqui.re
c. one enti1 y obtains control of one or more entities
d. an acqui~ obtains control of one or more businesses
96. An accounting system that collects financial and operating data on the basis of the underlying nat~ and extent of cost
driven is:
a.. Activity-based costing
b. Cycle-time costing
c. Variable costing
d. Target C05ting
97. Joint eosts are used for.
a.. detmnining inventory costs for acco1D1ring purposes
b. controlling costs
c. setting the selling price of a product
d. de1m11ining whether to continue producing an item
98. The following st,itements are based on PAS 8 (Accounting policies, changes in accounting estima1es and errors):
Staiemenl J: To the extent that a change in an accounting estimate gives rise to -:.hangcs in assets and liabilities, or
relate, to an item of equity, it ~hall be recogniz.ed by adjusting the carrying amo~t of the related asset. liability or
equity item in the period of the change.
Statement II: Prospective recognition of the effect of a change in an accounting estimate means that the change is
applied to transactions, other evcnl5 and conditions from the date of the change in estimate.
Staument /JI: A ch2ngc in the measurement basis applied is a change in an accollllting estimate, and is not a change in
an accounting p<>licy.
a.. True, tme, false
b. True, true. true
c. True, false, true
d. false, true, false
99. Joint product costs are generally allocated using the
a. Relative sales value
b. Additional costs after split-<>ff
c. Relative profitability
d. Direct labor houn
I00. Standard cost variances are not closed to:
a. Direct materials
b. Work-in-process
c. Finished goods
d. Costs of goods sold
IO I. Which cost accumulate procedure is most appropriate for a just-in-time (JID production system?
a. Baclcflu~h costing
b. Process costing
c. Job order costing
d. Activity-based costing

9 of 11
102.\\'h"' tn1n~l~llnt1 f,,n·ll!II Cll!Tl'IICY denuminaled lin1111clHI slalt•me111s inlo 1hr functitJ nnl currency, lhe e.<ch11111(t
clitlmncc~ ft!'\' rt,·,,i;uizcd:
A. A, Rn ill'nt ,if g~in or lo\S in the stnlcmcnt of profit or los~ & other comprehensi vc income
b. n~ 11 dd,m·d nssct or liability
c. AS A ~t'pAmtt component of equity
d. dircctly in the rctAincd eamin![s account
l03.Activity-bll5cd co~ting (AUC) first ns~igns costs to:
a. Activities
b. DepAnmcnt,
c. Product\
d. Overhead
104.Financial statement~ of nonprofit organization (NPO) includes all oflhe following, EXCEPT:
a. Statement uf changes in equity
b. Statement of financial position
c. Statement of nctivities
d. Statement of cash flows
IOS.ln an ABC system, what should be used to assign a department's manufacturing overhead costs to product, produced
in varying lot sizes?
a. Multiple cau~c-and-effect relationships
b. A single cause-and-effect relationship
c. Relative net sales values of the products
d. A product' s ability to bear cost allocations
106.ln comparison with !inns that use plant-wide overhead rates and departmental overhead rates, companies that have
adopted activity-ba~ed costing will typically use:
a. More cost pools and more cost drivers
b. More cos, pools and fewer cos, drivers
c. Fewer cost pools and more cost drivers
d. Fewer cost pools and fewer cost drivers
107.A company uses a two-way analysis for overhead variance: budget (controllable) and volume. The volume variance is
based on the:
a. Fixed overhead application rate
b. Total overhead application rate
c. Variable overhead application rate
d. Variable or fixed overhead application rate
l08.The statement offinancial position ofNPO shall repon separately 3 classes of net assets that EXCLUDE
a. Donated net assets ---
b. Unrestricted net assets
c. Temporarily restricted net assets
d. Pennanently restricted net assets
109.Nct assets that are restricted by the governing board of a non-government, not-for-profit organization are reported as
pan of:
a. Unrestricted n,:t assets
b. Any of these, depending on the terms
c. Permanently restricted net assets
d. Temporarily restricted net assets
110. The "contractual adjustment account" of a nonprofit hospital is a (an):
a. Contra-rcvt:nue account
b. Expense account
c. Loss account
d. Asset account
111. Under NGAS, how frequent should the trial balance be prepared? ~
a. Monthly
b. Quarterly
c. Semi-annually
d. Annually
112.Under NGAS, allotm.:nts by DBM are recorded in the registries
a. Quarterly
b. Monthly
c. At the beginning of the period
d. At the end of the period
113.Which is not a basic feature ofNGAS?
a. Four-digit responsibility account coding structure
b. One-fund concept
c. Two-column trial balance
d. Three-digit account number system

10 of 11
 I
I I•.Which Ii""', 1,.,1c fe-ttun~f NOA87
•· Corollary and nep~vc (red) en1tle1
b. rerpe11a1 Inventory'. ryattm
c. !in.Jahr-line dtprtd111un
d. Allowan~ for dou!tl,I
1UOUnt1
I I U011r111b llld led11en ire th book of 1CCoun11 of rhc national ic,yffllmcnl 1aenclct. Whf~n 11f rht fo!klwi"I ,,.,.i.
thall be UMd undrr NOAS
I. Ocntnil Journal r
b. lour1111I ,,rd1eck, luued
c. Joum1l IUld analy1ls ofobllp1ic,n1
d. Journal 1,f bills rendend
I 16.Under NOAS, supplict ant,llcrialJ purch~ for invcnrory purp<MI ue recorded Ulffll
•· Movlne avmge
b. fint-ln, llrw1-ou1 ( PO)
c. Lart-ln, f1nt-oul ( PO)
d. Wclchted aver1se
117.Under NOAS, It i, the allj ' ent by 1he Cenl1'111 office IO iu Regional off1CC.
L Suballotmenr
b. Rt1uuir allotment I
c. Ordin:iry Allotmell/
d. S«oncby Allotment .
118. It iJ Ill authoriz.ation i11utd by 1he DBM to govffllmenl 1gmcie1 to withdraw c:ASh from ~ Na11onal Treaa,y
through the inuiltlce of MOflitied Disbursement System checb.
a. Notice of Cash AIIF'ion
b. Allotmcnr ;
c. Obliprion ;
d. Appropriation •
l 19.Build-<>perate-11amferwBor arnneements under the scope of lFRIC 12 arc usually ~c between (among):
L · The government ~ tor) and I privaie entiry (operator)
b. The &overnment (qpcrator) and• private entity {&l'lntor)
c. The iovemmcnt (irtntor), ceneral public (operaor) and a private enlity
cl. General p~bllc ~ r ), a privare entity (operator) and the iovernment
120.Under a build-<>pente-cnrfer (BOT) scheme covered by IFRIC 12, any borrowin& cosu incurred by the priva:c
opermor for lnfn.st7UCture projecu shall be:
L l!.xpenstd (Financfl Asset model); Capitalized (Intangible Auel model)

1l. b. l!xpemcd (l'inancrl Asset model); Expensed (lntangible Asset model)

c. Capi!aliz.ed (Financial Asset model); Expensed (Intangible Auet model)
d. Capitalized (Fiaari::ial:.Asset model); Capitalized (Intangible Asset model)

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