Global Accounting Standards Practice Exam
Course Introduction
Global Accounting Standards explores the unified frameworks and principles that guide financial reporting across international borders, with a primary focus on the International Financial Reporting Standards (IFRS). The course examines the development, adoption, and implications of these standards in a globalized economy, comparing them to other major accounting systems such as US Generally Accepted Accounting Principles (GAAP). Students will analyze the benefits and challenges of standardization, assess the impact on multinational corporations, and consider the role of regulatory bodies. Practical case studies will highlight real-world applications, fostering a thorough understanding of how global standards enhance transparency, comparability, and investor confidence in international financial markets.
Recommended Textbook
International Accounting and Multinational Enterprises 6th Edition by Lee H. Radebaugh
Available Study Resources on Quizplus
16 Chapters
693 Verified Questions
693 Flashcards
Source URL: https://quizplus.com/study-set/3628
Page 2
Chapter 1: International Accounting and International Business
Available Study Resources on Quizplus for this Chatper
37 Verified Questions
37 Flashcards
Source URL: https://quizplus.com/quiz/72062
Sample Questions
Q1) As a result of the industrial revolution in the 19th and early 20th centuries,
A) governments got together and decided to require firms to draw up balance sheets every two years.
B) it was finally necessary to develop double entry accounting.
C) the basic form of business organization shifted to limited liability and joint stock companies.
D) fixed assets diminished in importance.
Answer: C
Q2) Securities markets influence corporate reporting
A) by forcing companies to increase the quantity and quality of their disclosures.
B) in industrial but not developing countries.
C) by requiring significant social disclosures due to pressure from Europe.
D) by eliminating the need for voluntary disclosures.
Answer: A
Q3) One trend in European securities markets is consolidation.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: International Accounting Patterns, Culture and Development
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/72063
Sample Questions
Q1) The concept of presenting a "true and fair view" of a company's financial statements depends heavily upon
A) professionalism.
B) uniformity.
C) Confucian dynamism
D) secrecy.
Answer: A
Q2) Which of the following accurately reflects German accounting?
A) Tax law is influential, because annual accounts are the basis for tax accounts.
B) The stock market is the major source of funding in Germany, so accounting reflects the needs of investors.
C) The Germans influenced the 4th Directive of the European Union through the introduction of the true and fair view.
D) German companies depart from historical cost through widespread use of current value accounting.
Answer: A
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Comparative International Financial Accounting
Available Study Resources on Quizplus for this Chatper
35 Verified Questions
35 Flashcards
Source URL: https://quizplus.com/quiz/72064
Sample Questions
Q1) Which of the following accurately reflects Japanese accounting?
A) On the authority and enforcement measures, the Japanese are professional and flexible.
B) The Japanese lean to statutory control and professionalism.
C) The Japanese have been heavily influenced by the Germans but not the Americans.
D) The Ministry of Justice enforces the Companies Act and the Ministry of Finance enforces the Securities and Exchange Act.
Answer: D
Q2) Which of the following countries prepares statements according to US GAAP?
A) France
B) Japan
C) Netherlands
D) Italy
Answer: B
Q3) Swiss accounting is among the most transparent in the world today.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Comparative International Financial Accounting
Available Study Resources on Quizplus for this Chatper
28 Verified Questions
28 Flashcards
Source URL: https://quizplus.com/quiz/72065
Sample Questions
Q1) India's accounting system is of a British origin.
A)True
B)False
Q2) One of the cures for the "Asian flu" problem was to decrease transparency.
A)True
B)False
Q3) Malaysia's accounting system is not of a British origin.
A)True
B)False
Q4) Which country implemented a shock therapy approach to a market-oriented economy?
A) Thailand
B) China
C) Italy
D) Poland
Q5) Which of the following pair of countries has similar accounting systems?
A) United States and Switzerland
B) Czech Republic and Poland
C) Brazil and Italy
D) Indonesia and Germany
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: International Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
35 Verified Questions
35 Flashcards
Source URL: https://quizplus.com/quiz/72066
Sample Questions
Q1) The treatment of inventory in Britain differs from that of the United States in that
A) the British approach to inventory measurement is much less restrictive.
B) FIFO is not permitted in Britain.
C) LIFO is not permitted in Britain.
D) in the United States, LIFO is not permitted.
Q2) Form 20-F is used for income tax calculations.
A)True
B)False
Q3) Assume that translated U.K. earnings are $100 and U.S. earnings are $120. The index of conservatism is
A) .800 (U.S. is more conservative)
B) .800 (British is more conservative)
C) 1.200 (U.S. is more conservative)
D) 1.200 (British is more conservative)
Q4) Currently, international standards
A) are developed to allow substantial flexibility
B) promote uniformity
C) are designed to reduce transparency
D) are developed by the IDOT
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: International Transparency and Disclosure
Available Study Resources on Quizplus for this Chatper
45 Verified Questions
45 Flashcards
Source URL: https://quizplus.com/quiz/72067
Sample Questions
Q1) Transparency
A) is consistent with confidentiality
B) is not an issue if the corporate report has reliable information
C) helps investors distinguish between good and bad quality firms
D) associates directly with the level of corruption
Q2) Competitive disadvantage
A) of increased disclosure will likely increase business incentives in the long term
B) affects the cost of data collection and processing.
C) is the most important cost factor in voluntary disclosures
D) increases direct disclosure costs
Q3) The mutuality of interests concept related to information disclosure implies that A) disclosure may help users be more aware of common interests, improving cooperation.
B) increased disclosure increases uncertainty about financial performance.
C) user benefits always exceed costs.
D) it is difficult to measure the costs and benefits of disclosure.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: International Accounting Standards and Global Convergence
Available Study Resources on Quizplus for this Chatper
37 Verified Questions
37 Flashcards
Source URL: https://quizplus.com/quiz/72068
Sample Questions
Q1) According to the 4th Directive of the EU,
A) companies must use the horizontal format for the balance sheet.
B) the vertical balance sheet includes current liabilities with current assets.
C) companies must report a cost of goods sold.
D) all personnel expenses must be included as a separate line item on the income statement due to the strength of unions in Europe.
Q2) As a result of the call for harmonization and better disclosure,
A) global investors are now able to make more informed international comparisons.
B) governments are better able to understand and constrain the activities of MNEs.
C) different information needs between and within groups may lead to conflicting demands for information.
D) all of the above.
Q3) Trade unions tend to be grounded in a national territory.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: International Business Combinations, Goodwill and Intangibles
Available Study Resources on Quizplus for this Chatper
60 Verified Questions
60 Flashcards
Source URL: https://quizplus.com/quiz/72069
Sample Questions
Q1) A major argument in favor of the immediate write-off approach to goodwill is that
A) it is an asset with future economic benefit.
B) its true value has no predictive relationship to the cost paid on acquisition.
C) it does not distort the financial statements.
D) It provides a more accurate relationship between debt and total assets.
Q2) An alternative to line-by-line consolidation is
A) proportional consolidation
B) minority interest accounting
C) joint-venture accounting
D) the cost method
Q3) IAS 7
A) encourages the direct method
B) requires the direct method
C) encourages the indirect method
D) requires the indirect method
Q4) Group identification is a problem for international consolidation.
A)True
B)False
Page 10
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: International Segment Reporting
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/72054
Sample Questions
Q1) Most corporations do not provide segment reponting
A) for LOB information separately
B) for LOB information in matrix form
C) of sales data
D) identified by SIC
Q2) External yardsticks are available for most diversified MNEs.
A)True
B)False
Q3) A major argument against segment disclosure is that
A) gross margins will fall
B) transfer pricing activity will increase
C) in some cases it may be misleading
D) MNEs will have to do more mergers
Q4) Segment disclosures
A) do not affect firm risk
B) increase firm risk
C) increase the MNE price variability
D) decrease the MNE price variability
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Foreign Currency Transactions and Translation
Available Study Resources on Quizplus for this Chatper
55 Verified Questions
55 Flashcards
Source URL: https://quizplus.com/quiz/72055
Sample Questions
Q1) Remeasurement does not require the temporal rate method.
A)True
B)False
Q2) In general, if the Japanese subsidiary of a U.S. company firm translates its financial statements according to the current rate method during a period when the value of the Japanese yen is falling against the reporting currency (the U.S. dollar) , the subsidiary will recognize a
A) translation gain in the income statement.
B) translation loss in the income statement.
C) translation gain in the accumulated translation adjustment account in owners' equity.
D) translation loss in the accumulated translation adjustment account in owners' equity.
Q3) No foreign exchange accounting problem arises as long as the transactions are denominated in the firm's domestic currency.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: International Accounting for Price Changes
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/72056
Sample Questions
Q1) Controversy remains for price change accounting with respect to I..the gearing adjustment
II..the treatment of gains and losses on monetary items
A) only I
B) only II
C) I and II
D) neither I or II
Q2) Current cost accounting is required in the I..UK
II..US
A) only I
B) only II
C) I and II
D) neither I nor II
Q3) The effect of inflation on nonmonetary assets is reflected in the A) only I
B) only II
C) both I and II
D) neither I or II
To view all questions and flashcards with answers, click on the resource link above.
Page 13
Chapter 12: Corporate Governance and Control of Global Operations
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/72057
Sample Questions
Q1) For IT, economies of scale result in
A) worldwide innovation.
B) local differentiation.
C) global integration.
D) lateral relations.
Q2) A centralized, globally scaled strategy is symbolic of a A) multidomestic strategy.
B) global strategy.
C) transnational strategy.
D) geocentric strategy.
Q3) The external takeover market is an effective control mechanism
I..in the US
II..in the UK
III. throughout the world
A) only for I
B) only for II
C) either I or II
D) III is the best answer
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Foreign Exchange Risk Management
Available Study Resources on Quizplus for this Chatper
67 Verified Questions
67 Flashcards
Source URL: https://quizplus.com/quiz/72058
Sample Questions
Q1) Assuming the tax treatment for foreign currency transactions, what is the foreign exchange gain or loss on November 15?
A) $100 gain
B) $300 gain
C) $350 gain
D) $100 loss
E) gain or loss is deferred
Q2) The difference between the spot rate on June 1 and the forward rate is a
A) $375 foreign exchange gain
B) $375 foreign exchange loss
C) $1500 foreign exchange loss
D) $1500 foreign exchange gain
Q3) Assuming that you entered into the option and the strike price were 160, what would be your net cash proceeds on July 15?
A) $117,000.00
B) $120,000.00
C) $117,537.50
D) $117,512.50
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: International Budgeting and Performance Evaluation
Available Study Resources on Quizplus for this Chatper
43 Verified Questions
43 Flashcards
Source URL: https://quizplus.com/quiz/72059
Sample Questions
Q1) In transferring the domestic performance evaluation system into the international environment, MNEs
A) are creating a more expensive performance evaluation system.
B) miss significant foreign events that could affect performance.
C) are taking into consideration that there are strategic differences in subsidiaries.
D) are sacrificing comparability for understandability.
Q2) Return on investment is a popular performance evaluation technique of MNEs, because
A) it takes into consideration transfer pricing policies.
B) it allows the parent company to compare operations more easily.
C) it is an accurate indicator of currency differences.
D) it allows the MNEs to focus on market share.
Q3) A performance evaluation tool that measures after-tax operating profit minus the total annual cost of capital is
A) return on investment.
B) return on assets.
C) economic value added.
D) residual income.
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: International Auditing Issues
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/72060
Sample Questions
Q1) International auditing standards
A) make it more difficult for developing countries to produce domestic auditing standards
B) are principally generated by FASB
C) are created and reviewed by G11 summits
D) provide incentives to improve and extend the set of international accounting standards
Q2) Reciprocity is a problem for international audit firms.
True
A)True
B)False
Q3) International audits have a challenge because local business practices pay expenses with cash.
True
A)True
B)False
Q4) Sarbanes-Oxley prohibits auditors from doing non-audit services.
False
A)True
B)False
Page 17
To view all questions and flashcards with answers, click on the resource link above.
Chapter 16: International Taxation Issues
Available Study Resources on Quizplus for this Chatper
45 Verified Questions
45 Flashcards
Source URL: https://quizplus.com/quiz/72061
Sample Questions
Q1) Assume that a wholesaler purchased goods from a manufacturer was £34.50 (gross price), the VAT is 15%, and the VAT paid by the manufacturer was £4.50. The markup on the merchandise is £10. What is the net amount of VAT paid to Customs and Excise under the British system of computing VAT?
A) £1.5
B) £5.0
C) £46
D) none of the above.
Q2) If the French subsidiary of a U.S. company ships components to its U.S. parent at an arbitrarily low transfer price,
A) the French subsidiary will show relatively high profits.
B) the French government will collect relatively low corporate income tax.
C) U.S. Customs will collect relatively high tariffs.
D) the U.S. parent will show lower pre-tax profits.
Q3) Except for certain CFC cases, U.S. parent does not declare income from a foreign corporation for tax purposes until it actually receives a dividend.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 18