Financial Statements and Accounting Standards

1216 WordsSep 9, 20135 Pages
1. The existence of a limited liability company means the: I. company’s members are liable for only a limited amount of business debts II. company has a legal existence distinct from its owners III. company may raise large amounts of funds by issuing shares. | I only | | I and II only | | II and III only | | I, II and III | 2. The two main types of companies permitted to be registered under the Corporations Act are: | a private company, and a proprietary company | | a public company, and a trade union | | a proprietary company, and a public company | | a proprietary company, and a partnership | 3. A proprietary company must have at least one shareholder and cannot have more than:…show more content…
The Conceptual Framework defines income as follows: | Increases in economic benefits during the accounting period in the form of inflows or enhancements of assets or decreases of liabilities that result in increases in equity, other than those relating to contributions from equity participants | | The gross inflow of economic benefits during the period arising in the course of ordinary activities of an entity when those inflows result in increases in equity, other than increases relating to contributions from equity participants | | Income that arises in the ordinary course of business and is referred to by a variety of different names, including sales, fees, interest, dividends and royalties | | Income is not defined in the Conceptual Framework | 14. A company incurs significant costs in relation to a speculative project that intends to turn rocks into gold. In accordance with the AASBs Conceptual Framework the costs of this project are an: | expense because there is little probability that future economic benefits will eventuate | | expense because the
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