Corporate Reporting
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Course Introduction
Corporate Reporting focuses on the principles, practices, and regulatory frameworks involved in the preparation and communication of financial information for external stakeholders. The course covers key aspects of International Financial Reporting Standards (IFRS), corporate governance, integrated reporting, and the ethical responsibilities of accountants. Students will learn how corporate reports are used by investors, regulators, and other stakeholders to assess an organizations performance, position, and prospects. The course also examines recent developments in sustainability reporting and the impact of emerging issues such as digital reporting and global harmonization of accounting standards.
Recommended Textbook
Modern Advanced Accounting in Canada 6th Edition by Murray Hilton
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12 Chapters
691 Verified Questions
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Page 2
Chapter 1: A Survey of International Accounting
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Sample Questions
Q1) At present,Canada's accounting policies most resemble those of which nation?
A)The United Kingdom.
B)The United States.
C)The European Union (EU)
D)Australia
Answer: B
Q2) IMVAR INC is US-based Company with Subsidiaries in both the United States and in Canada.The Company's Consolidated Financial Statements show a significantly higher net-income amount when prepared under Canadian GAAP than under U.S.GAAP.This difference can be largely explained by
A)different corporate tax rates in each country.
B)timing differences which will reverse out in the future.
C)differing reporting requirements in each country.
D)currency fluctuations.
Answer: B
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Chapter 2: Investments in Equity Securities
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Sample Questions
Q1) Ronen Corporation owns 35% of the outstanding voting shares of Western Communications Inc.Over which it exerts significant influence.The carrying value of its investment as at October 31,2009 was $3,750,000.Ronen has now designated its investment in Western as FVTPL as a result of the open market purchase of a 51% interest in Western by Overhaul Corp.Western is in financial distress.The market value of Ronen's 35% interest is now $2,000,000.
Required:
(a)What is the accounting result of a change from the equity method of accounting to FVTPL;
(b)Do any journal entries need to be recorded by Ronen as a result of this change? If so,what is the entry?
Answer: (a)When an investment changes from significant influence to FVTPL the equity method ceases to be appropriate and the fair value method takes its place on a prospective basis.On this date,the investor shall measure at fair value any investment the investor retains in the former associate.
The investor shall recognize in profit or loss any difference between:
Q2) Prepare X's journal entries for 2002 and 2003,assuming that this is a Portfolio Investment.
Answer: 11ea8eda_c611_a09a_9698_8df93e35ac5e_TB4094_00_TB4094_00
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Page 4
Chapter 3: Business Combinations
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Sample Questions
Q1) Company Y purchases a controlling interest in Company Z on January 1,2002.Which of the following would appear as the Shareholder Equity amount on Company Y's Consolidated Balance Sheet on the date of acquisition?
A)Company Y's Shareholder Equity
B)The sum of the Shareholder Equity of both companies.
C)Company Y's Shareholder Equity as well as Company Y's proportional share of company Z's net assets at book value.
D)Company Y's Shareholder Equity as well as Company Y's proportional share of company Z's net assets at Fair Market Value.
Answer: A
Q2) The Shareholder's Equity section of the Consolidated Balance Sheet would show what amount?
A)$121,000
B)$90,000
C)$19,000
D)$98,000
Answer: D
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Page 5
Chapter 4: Consolidated Statements on Date of Acquisition
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Sample Questions
Q1) Contingent consideration will be classified as a liability when
A)it will be paid in the form of additional equity.
B)it will be paid in the form of cash or another asset.
C)the form of payment will be determined at a future date.
D)the acquirer decides the appropriate time to make a payment.
Q2) When the parent forms a new subsidiary,
A)there should be no acquisition differential.
B)a gain or loss will usually arise.
C)push down accounting rules must be followed)
D)it should not be included in the company's consolidated financial statements as this would effectively be double-counting.
Q3) The purchase price of an entity includes:
A)the book value of the subsidiary's shareholder equity and the acquisition differential.
B)the book value of the subsidiary's shareholder equity and goodwill.
C)the fair market value of the subsidiary's shareholder equity and the purchase price discrepancy.
D)the fair market value of the subsidiary's net assets.
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6
Chapter 5: Consolidation Subsequent to Acquisition Date
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Sample Questions
Q1) Any excess of fair value over book value attributable to land on the date of acquisition is to be
A)allocated to other identifiable assets.
B)capitalized and amortized.
C)charged to Retained Earnings on the date of acquisition.
D)taken into income when the Land is sold.
Q2) What would be the net income reported on Errant's Consolidated Income Statement on December 31,2007? Assume that Errant's income for the year does not include any income from Grub.
A)$90,000
B)$250,000
C)$160,000
D)$230,000
Q3) Assuming that GNR Inc uses the Equity Method,what effect would the above information have on GNR's investment in NMX account?
A)An increase of $30,000.
B)An increase of $40,000.
C)An increase of $10,000
D)No effect.
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Page 7
Chapter 6: Intercompany Inventory and Land Profits
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Sample Questions
Q1) Intercompany profits on sales of inventory are only realized
A)once the seller receives payment for the sale.
B)once the inventory has been sold to outsiders.
C)when the inventory has been received by the purchaser.
D)when the inventory has been shipped to the purchaser.
Q2) Where would the amortization of the acquisition differential be reflected on Kho's Consolidated Income Statement?
A)It would be reflected through non-controlling interest in earnings.
B)It would be reflected through other expenses.
C)It would be reflected through cost of sales.
D)It would be reflected as a reduction of sales.
Q3) Under which of the following Theories is the elimination of ALL intercompany profits called for?
A)The Ownership Theory.
B)The Entity Theory.
C)The Proprietary Theory.
D)The Parent Theory.
Q4) Prepare a schedule showing the realized and unrealized profits for Q Inc.for 2006 and 2007.Your schedule should include both pre-tax and after-tax amounts.
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Chapter 7: Aintercompany Profits in Depreciable Assets
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Sample Questions
Q1) What effect would the intercompany bond sale have on Ting's December 31,2010 Consolidated Income Statement?
A)Ting would record a gain of $5,000.
B)Ting would record a gain of $10,000.
C)Ting would record a loss of $15,000.
D)Ting would record a loss of $5,000.
Q2) Prepare a summary of intercompany bond transactions.Be sure to show the gain or loss for each company as well as the effect on the consolidated entity.
Q3) Calculate the goodwill as at December 31,2009.
Q4) Ignoring income taxes and any minority interest effects,what is the amount of profit realized during 2009 from the intercompany sale of equipment?
A)Nil
B)$5,000
C)$8,000
D)$4,000
Q5) Prepare a Statement of Consolidated Retained Earnings for the year ended December 31,2003 for Plax Inc.
Q6) Prepare a summary of intercompany interest revenues and expenses.
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Chapter 8: Consolidated Cash Flows and Ownership Issues
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Sample Questions
Q1) What is the net Income for the combined entity?
A)$2,170,000
B)$660,000
C)$1,510,000
D)$1,773,625
Q2) What is the amount of the acquisition differential amortization for 2009?
A)$6,250
B)$4,375
C)$5,625
D)$12,000
Q3) What effect (if any)would Hanson's January 1,2010 purchase have on the company's consolidated cash flows for the year?
A)There would be no effect.
B)There would be a decrease in cash of $45,000 to the consolidated entity.
C)There would be a decrease in cash of $200,000 to the consolidated entity.
D)There would be a decrease in cash of $236,000 to the consolidated entity.
Q4) Prepare a statement of non-controlling interest as at December 31,2011.
Q5) Prepare Lime's December 31,2011 Consolidated Balance Sheet.
Q6) Prepare an acquisition differential amortization table since the acquisition date.
Page 10
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Chapter 9: Other Consolidated Reporting Issues
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Sample Questions
Q1) What is the amount of non-controlling interest that would appear on Seek's December 31,2010 Consolidated Balance Sheet?
A)$144,000
B)$136,000
C)$180,000
D)Nil.
Q2) What is the amount of the Deferred Tax Asset or Liability on December 31,2011?
A)a Deferred Tax Asset of $1,350
B)a Deferred Tax Asset of $1,675
C)a Deferred Tax Liability of $1,350
D)a Deferred Tax Liability of $375
Q3) What is the total amount of cost of sales that would appear on the Consolidated Income Statement?
A)$500,000
B)$420,000
C)$398,000
D)$396,000
Q4) Prepare A Corp.'s equity method journal entries for 2010,assuming that the assets donated by B Corp.included cash in the amount of $400,000.
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Chapter 10: Foreign Currency Transactions
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Sample Questions
Q1) What is the amount of the forward contract in Canadian dollars?
A)$72,000
B)$70,500
C)$70,950
D)$71,850
Q2) Which of the following is correct?
A)The historical rate is the exchange rate on the date of the transaction and the closing rate is the exchange rate at the end of the reporting period.
B)The historical rate is the exchange rate on the date of the transaction and the closing rate is the rate on which any hedge transactions mature.
C)The spot rate is the rate on the date of the transaction and the relevant forward rate is the exchange rate used at the end of the reporting period.
D)None of the above.
Q3) Prepare a partial Balance Sheet for Maplehauff Inc.on December 31,2012 showing the Account Receivable from the American client as well as the accounts associated with the hedge.
Q4) Prepare the journal entries for 2011.
Q5) Prepare any and all journal entries arising from this transaction.
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Chapter 11: Translation and Consolidation of the Financial
Statements of Foreign Operations
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Sample Questions
Q1) Which of the following rates would be used to translate the company's accounts receivable?
A)$1CDN=$0.815 U.S.
B)$1CDN=$0.8175 U.S.
C)$1CDN=$0.8250 U.S.
D)$1CDN=$0.83 U.S.
Q2) Translate Martin's 2011 Income Statement into Canadian dollars.
Q3) Which of the following statements is correct?
A)If an organization is self-sustaining,depreciation and amortization must be translated using closing rates.
B)If an organization is self-sustaining,depreciation and amortization must be translated using average rates.
C)If an organization is self-sustaining,depreciation and amortization must be translated using historical rates.
D)If an organization is considered an integrated foreign subsidiary depreciation and amortization must be translated using closing rates.
Q4) Compute Martin's exchange gain or loss for 2011.
Q5) Translate Wilsen's December 31,2014 Statement of Retained Earnings.
Q6) Compute Wilsen's exchange gain or loss for 2014.
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Chapter 12: Accounting for Not-For-Profit Organizations and
Governments
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Sample Questions
Q1) How would the not-for-profit organization report each controlled profit-oriented enterprise?
A)It is not required to report its interest in for-profit subsidiaries and it is not-for-profit.
B)By disclosure it the notes to the financial statements of the not-for-profit organization.
C)By consolidating the controlled enterprise into its own financial statements or by using the equity method and disclosing additional financial information.
D)By using the cost method together with appropriate note disclosure.
Q2) Describe what fund accounting is and why is it used for not-for-profit organizations.
Q3) Prepare journal entries for these transactions,using the deferred contribution method,assuming that the assets were purchased using restricted funds in the amount of $11,000.
Q4) What would be the balance in the Capital Fund on December 31,2012?
A)$4,400
B)$6,400
C)$400
D)($1,600)
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Page 14