Choose the letter of the correct answer. 7.7 The following statements are correct, except:Other comprehensive income comprises items of incomeand expense, excluding reclassification adjustments, that arerecognized in profit or loss.а.b.Omissions or misstatement of items are material if they couldindividually or collectively influence the economic decisions ofusers.Assessing whether an omission or misstatement could influenceéconomic decisions of users, and so become material, requireconsideration of the characteristics of those users.С.Users are assumed to have a reasonable knowledge of businessand economic activities and accounting and a willingness to studythe information with reasonable diligence.d.

SOLUTION- FINANCIAL STATEMENT ARE FORMAL RECORDS OF FINANCIAL ACTIVITIES AND POSITION OF A BUSINESS…

7. The following statements are correct, except: Other comprehensive income comprises items of income and expense, excluding reclassification adjustments, that are recognized in profit or loss. а. b. Omissions or misstatement of items are material if they could individually or collectively influence the economic decisions of users. С. Assessing whether an omission or misstatement could influence economic decisions of users, and so become material, requires consideration of the characteristics of those users. d. Users are assumed to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence.

7. The following statements are correct, except: Other comprehensive income comprises items of income and expense, excluding reclassification adjustments, that are recognized in profit or loss. а. b. Omissions or misstatement of items are material if they could individually or collectively influence the economic decisions of users. С. Assessing whether an omission or misstatement could influence economic decisions of users, and so become material, requires consideration of the characteristics of those users. d. Users are assumed to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 23MCQ

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10. In accordance with PAS 1, which of the following gains or losses from reclassification of financial assets need not be presented separately in the profit or loss section or the statement of profit or loss?a. Reclassification of financial assets out of the amortized cost measurement category to FVTPL. b. Reclassification of financial assets out of theFVTOCI measurement category to FVTPL.c. Reclassification of financial assets out of the FVTPLmeasurement category. d. None of these. 11. In accordance with PAS 1, which of the following expenses need not be presented separately in the profit or loss section or the statement of profit or loss? a. Finance costsb. Share of loss of associates c. Tax expensed. Depreciation expense 12. You are preparing the income statement of Anonymous Company for the year ended December 31, 2020. You determine that company's income from continuing operations before income taxes is P2,400,000.…
10. In accordance with PAS 1, which of the following gains or losses from reclassification of financial assets need not be presented separately in the profit or loss section or the statement of profit or loss?a. Reclassification of financial assets out of the amortized cost measurement category to FVTPL. b. Reclassification of financial assets out of theFVTOCI measurement category to FVTPL.c. Reclassification of financial assets out of the FVTPLmeasurement category. d. None of these.
68. Which of the following is reported as other comprehensive income in accordance with PAS 1, Presentation of Financial Statement? Group of answer choices sale of inventory at more than cost changes in revaluation surplus impairment loss of depreciable asset loss on sale of machinery
5 Which of the following changes during a period is not a component of other comprehensive income? Group of answer choices a. Foreign currency translation adjustment b. Remeasurement of defined benefit costs c. Unrealized gain on equity instrument measured at fair value d. though other comprehensive income Treasury shares, at cost6 An entity shall present an analysis of expenses using a classification based on Group of answer choices a. the function of expense b. the nature of expense c. either the nature of expense or the function of expense, whichever the entity would prefer to present d. either the nature of expense or the function of expense, whichever provides information that is reliable and more relevant
17 The accounting book value of an asset represents the historical cost of the asset rather than its current market value or replacement cost. Select one: True False
In accordance with PAS 1, the profit or loss section or the statement of profit or loss shall include line item for gains and losses from derecognition of Group of answer choices Financial assets measured at fair value through profit or loss. Financial assets measured at amortized cost. All of these. Financial assets measured at fair value through other comprehensive income.
Which of the following accounting principles or conventions is contradictory to the GAAP requirement to expense R&D costs immediately? matching principle historical cost principle comparability conservatism
If a company has elected the fair value option, where are gains and losses resulting from adjusting these accounts to fair value reported? Group of answer choices Unrealized Gains are reported as part of Other Comprehensive Income while Unrealized losses are reported as part of Net Income. Unrealized Gains and Losses are both reported as part of Net Income. Unrealized Gains are reported as part of Net Income, while Unrealized Losses are reported as part of Other Comprehensive Income. Unrealized Gains and Losses are both reported as part of Other Comprehensive Income.
Which of the following statements about Loss Contingencies is TRUE? According to the practice of accounting conservatism, contingency losses do not have to be accrued until they are confirmed, while contingency gains have to be recorded when the event confirming their receipt is probable. Remote Losses do not require disclosure. According to the U.S. GAAP, a loss contingency must be accrued by a charge to income if any of the two conditions is met: 1) it is probable that an asset has been impaired, or a liability has been incurred at the date of the financial statements; 2) the amount of the loss can be reasonably estimated. If a loss is probable but cannot be estimated, it shall not be disclosed in the financial statements.
Under PAS 1, which of the followingitem is not included in the computation of profit? Finance cost. Post-tax gain or loss on discounted operations. Unrealized gain in change in value of biological assets. Unrealized gain in change in value of available-for-sale securities.
The Effect of Ignoring Adjusting Entries on Net Income For each of the following independent situations, determine whether the effect of ignoring the required adjusting entry will result in an understatement (U), will result in an overstatement (O), or will have no effect (NE) on net income for the period.