Intermediate Accounting I Exam Bank
Course Introduction
Intermediate Accounting I is designed to deepen students' understanding of accounting principles and practices, focusing on the conceptual and technical aspects of financial reporting. The course covers essential topics such as the accounting cycle, preparation of financial statements, revenue recognition, and the measurement and reporting of assets, including cash, receivables, and inventories. Emphasis is placed on developing analytical abilities and proficiency in applying Generally Accepted Accounting Principles (GAAP) to complex accounting scenarios. Through case studies and problem-solving exercises, students enhance their ability to interpret and communicate financial information, laying a strong foundation for advanced study in accounting and preparation for professional certification exams.
Recommended Textbook
Intermediate Accounting 2nd Edition Volume I by Kin Lo George Fisher
Available Study Resources on Quizplus 10 Chapters
1107 Verified Questions
1107 Flashcards
Source URL: https://quizplus.com/study-set/3365 Page 2
Chapter 1: Fundamentals of Financial Accounting Theory
Available Study Resources on Quizplus for this Chatper
33 Verified Questions
33 Flashcards
Source URL: https://quizplus.com/quiz/66822
Sample Questions
Q1) Explain the meaning of financial accounting, managerial accounting and tax accounting. How are these accounting activities related to each other?
Answer: Financial reporting is the process by which enterprises provide information to external parties.
Managerial accounting, on the other hand, involves reporting within the enterprise. Tax accounting is the reporting of taxable amounts to the government revenue authorities.
What ties all the branches of accounting together is the idea that some people have information that others need.
Q2) Discuss two ways in which a bank can mitigate the problem of moral hazard when lending money to a company.
Answer: The lender can request certain covenants that must be satisfied as a condition of granting the loan; for example, a requirement to have a certain debt-to-equity ratio so that the company does not get over-leveraged. Also, the bank can request an audit report be prepared.
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: Conceptual Frameworks for Financial Reporting
Available Study Resources on Quizplus for this Chatper
60 Verified Questions
60 Flashcards
Source URL: https://quizplus.com/quiz/66823
Sample Questions
Q1) Which is not an example of trade-offs made in the IFRS Framework?
A)Relevance versus representational faithfulness.
B)Comparability versus consistency.
C)Physical capital versus financial capital.
D)Timeliness versus verifiability.
Answer: C
Q2) Financial statements under the IFRS Framework do not help users with what kind of objective(s)?
A)Alleviating moral hazard.
B)Forecasting future product growth.
C)Prediction of future earnings.
D)Evaluating the riskiness of an investment.
Answer: B
To view all questions and flashcards with answers, click on the resource link above.
4
Chapter 3: Accrual Accounting
Available Study Resources on Quizplus for this Chatper
159 Verified Questions
159 Flashcards
Source URL: https://quizplus.com/quiz/66824
Sample Questions
Q1) The method of depreciation was changed from the double-declining-balance method to the straight-line method in fiscal 2013. A machine was purchased on January 1, 2011, at a cost of $150,000. The machine has an estimated useful life of 10 years and a residual value of $9,000. What adjustment is needed for fiscal 2011?
A)$14,100
B)$15,900
C)$24,000
D)$30,000
Answer: B
Q2) Under the IFRS Framework, what general information is useful for the decision making needs of lenders and investors?
A)Information prepared on the cash basis of accounting.
B)Information and changes in information relating to the entity's resources and claims against those resources.
C)Financial performance resulting from a company's operating activities.
D)Information on the company's equity and share structure.
Answer: B
To view all questions and flashcards with answers, click on the resource link above.
5
Chapter 4: Revenue Recognition
Available Study Resources on Quizplus for this Chatper
110 Verified Questions
110 Flashcards
Source URL: https://quizplus.com/quiz/66825
Sample Questions
Q1) Explain why accounting standards generally prescribe a smaller set of alternatives for revenue recognition.
Q2) Explain how the timing of revenue recognition is affected by multiple deliverables in the arrangement. Explain how revenue is ultimately recognized in a multiple deliverable sales transaction.
Q3) Which accounting method is permitted under ASPE for construction contracts?
A)An accounting method that recognizes revenue and expenses on a cash basis.
B)An accounting method that recognizes revenue and expenses only after it is completed.
C)An accounting method that recognizes costs as incurred and an amount of revenue equal to the costs that are expected to be recovered on the contract.
D)An accounting method that recognizes revenue and expenses based on the fair value of the contract.
Q4) You are an accountant working at Phantastic Pharmaceutical Inc. and have been asked to explain to your controller the possible points at which revenue could be recognized by your organization. Identify two alternatives that are conceptually valid for recognizing revenue at Phantastic.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Cash and Receivables
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/66826
Sample Questions
Q1) Which statement is correct?
A)The "gross" method for recording cash discounts is conceptually better than the "net" method.
B)The net method understates expenses.
C)The gross method overstates revenue.
D)Under the "gross" method, an entry is needed if the discount is taken.
Q2) Sahil Inc. reported credit sales of $600,000 and cash collections of $450,000 for last year. The ending balance in accounts receivable was $800,000. Bad debt expense is estimated at 1% of credit sales. The allowance for doubtful accounts had a balance of $80,000 at the beginning of the year. What was the bad debt expense for the year?
A)$1,500
B)$6,000
C)$8,000
D)$86,000
Q3) Royal Inc. offers terms of 4/10, net 60 for its accounts receivable. The company issues an invoice for $73,000. How should Royal record the invoice if it uses (a)the gross method and (b)the net method?
Q4) Explain two problems associated with the direct write-off method.
Q5) Explain why a bank reconciliation is necessary.
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Inventories
Available Study Resources on Quizplus for this Chatper
156 Verified Questions
156 Flashcards
Source URL: https://quizplus.com/quiz/66827
Sample Questions
Q1) Which inventory method provides the highest quality information for the income statement?
A)LIFO.
B)FIFO.
C)Weighted average.
D)Retail inventory.
Q2) Assume that a purchase invoice for $1,000 was appropriately recorded in fiscal 2012, but the inventory was excluded in error during the ending inventory count. What impact will this not have on fiscal 2013 financial reporting?
A)Beginning inventory is understated by $1,000.
B)Gross margin is understated by $1,000.
C)Cost of sales is overstated by $1,000.
D)Inventory is overstated on the balance sheet.
Q3) Which statement is correct about inventory errors?
A)Misstatements in inventory usually affect two reporting periods.
B)Misstatements in inventory usually affect only the current accounting period.
C)Misstatements in inventory usually affect only beginning inventory amounts.
D)Misstatements in inventory usually affect only ending inventory amounts.
Q4) Explain why the absorption costing method is appropriate under GAAP.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Financial Assets
Available Study Resources on Quizplus for this Chatper
141 Verified Questions
141 Flashcards
Source URL: https://quizplus.com/quiz/66828
Sample Questions
Q1) When there is no specific trading intention, what should an investment be classified as?
A)Held to maturity.
B)Available for sale.
C)Loans and receivables.
D)Associate.
Q2) On January 1, 2012, CC Company acquired 60,000 shares, representing 20% of the outstanding shares of VV Limited, at $25 per share. On July 31, 2012, VV declared and paid a dividend of $3 per share. VV's net income for 2012 was $1,000,000. On December 31, 2012, the shares of VV were trading on the Toronto Stock Exchange at $31 per share. Required:
CC is not sure how to report its investment in VV shares. Using the format provided, indicate the amounts that would appear on the balance sheet and the statement of comprehensive income for 2012 if the investment is considered to be (a)available for sale, (b)held for trading, or (c)an associate.
Q3) How does having significant influence over an investee alleviate information asymmetry?
Q4) Explain the meaning of the "effective interest method."
To view all questions and flashcards with answers, click on the resource link above.
Page 9
Chapter 8: Property, Plant, and Equipment
Available Study Resources on Quizplus for this Chatper
127 Verified Questions
127 Flashcards
Source URL: https://quizplus.com/quiz/66829
Sample Questions
Q1) What costs should not be capitalized to "equipment"?
A)Non-refundable sales tax
B)Refundable sales tax
C)Interest during construction of equipment
D)Transportation and delivery
Q2) Discuss how inappropriate capitalization of costs during the acquisition of PPE can manipulate earnings.
Q3) What issue does not relate to the subsequent measurement of property, plant and equipment?
A)Which model to use to record depreciation.
B)How impairment should be recorded.
C)How to classify the expenditure.
D)Whether to use the fair value model.
Q4) Explain derecognition of property, plant or equipment.
Q5) What is the IFRS treatment for replacements versus repairs?
A)Betterments are expensed because they do not extend the life of the asset.
B)Replacement of significant asset components are capitalized.
C)Repairs are capitalized because they do occur on a recurring basis.
D)A company can make a policy choice on the treatment of these expenditures.
Page 10
Q6) Explain how non-monetary transactions are accounted for.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: Intangible Assets, Goodwill, Mineral Resources, and
Government Grants
Available Study Resources on Quizplus for this Chatper
81 Verified Questions
81 Flashcards
Source URL: https://quizplus.com/quiz/66830
Sample Questions
Q1) Which statement is not correct?
A)Assessing the useful life of an intangible asset requires professional judgment.
B)The residual value of an intangible asset is the same as the asset's salvage value.
C)The straight-line method of amortization is generally used for intangible assets.
D)An equal pattern is reflected by the straight-line method of amortization.
Q2) Which statement describes the "full cost" method?
A)A method of accounting that capitalizes costs of mineral exploration and evaluation only if the outcome is successful.
B)A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is technically feasible.
C)A method of accounting that capitalizes costs of mineral exploration and evaluation costs without regard to outcome.
D)A method of accounting that capitalizes costs of mineral exploration and evaluation only if the production is commercially viable.
Q3) Explain the accounting for internally developed intangible assets.
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Applications of Fair Value to Non-Current Assets
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/66831
Sample Questions
Q1) Which of the following is correct with respect to when the impairment test must be performed?
A)An annual test is required for definite lived assets under IFRS.
B)An annual test is required for definite lived assets under ASPE.
C)An annual test is required for indefinite lived assets under IFRS.
D)An annual test is required for indefinite lived assets under ASPE.
Q2) Explain how non-current assets such as definite lived intangibles, indefinite lived intangibles and goodwill are tested for impairment under IFRS.
Q3) Which statement is not correct?
A)Impairment testing is required under ASPE.
B)Impairment testing is required under IFRS.
C)Impairment testing is not required under ASPE.
D)Impairment testing is required under both IFRS and ASPE.
Q4) Which is an exception to the rule: "test for impairment only if there are indicators for impairment"?
A)Intangible assets with indefinite lives.
B)Intangible assets with definite lives.
C)Internally generated goodwill.
D)Tangible assets with definite lives.
Page 12
To view all questions and flashcards with answers, click on the resource link above.