Professional Accountancy
Solved Exam Questions
Course Introduction
Professional Accountancy is a comprehensive course designed to equip students with the essential knowledge and practical skills required for a successful career in accounting and finance. The course covers fundamental concepts such as financial accounting, management accounting, auditing, taxation, and ethics, while also exploring the latest developments in accounting standards and regulatory frameworks. Through case studies, real-world scenarios, and practical exercises, students develop a thorough understanding of financial reporting, analysis, and decision-making processes. Emphasis is placed on professional conduct, critical thinking, and the application of accounting principles in diverse business settings, preparing graduates to meet the demands of the dynamic accounting profession.
Recommended Textbook
Intermediate Accounting 6th Edition Volume 1 by Thomas H. Beechy
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10 Chapters
1408 Verified Questions
1408 Flashcards
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Page 2
Chapter 1: The Framework for Financial Reporting
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79 Verified Questions
79 Flashcards
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Sample Questions
Q1) Professional accountants need a wide range of knowledge and skills.Which of the following is not an example of such knowledge or skills?
A)An ability to calculate and analyze data, and a facility with numbers.
B)Knowledge of many disciplines such as finance, economics, management, marketing and statistics.
C)An ability to communicate in a concise and understandable manner.
D)Skills derived from prior management experience.
Answer: D
Q2) Which of the following statement(s) is(are) correct?
A)Companies that use the disclosed basis of accounting are in effect using differential reporting.
B)Companies that use the disclosed basis of accounting are NOT allowed to use differential reporting.
C)When used, the disclosed basis of accounting must comply with GAAP.
D)Both "companies that use the disclosed basis of accounting are NOT allowed to use differential reporting" and "when used, the disclosed basis of accounting must comply with GAAP" are correct.
Answer: B
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Chapter 2: Accounting Judgements
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129 Verified Questions
129 Flashcards
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Sample Questions
Q1) The information provided by financial reporting pertains to:
A)individual business enterprises and the economy as a whole, rather than to industries or to members of society as consumers.
B)individual business enterprises, industries and the economy as a whole, rather than to members of society as consumers.
C)individual business enterprises, rather than to industries of the economy as a whole or to members of society as consumers.
D)individual business enterprises and industries rather than to the economy as a whole or to members of society as consumers.
Answer: C
Q2) Revenue is recognized when service is rendered and collection is probable. A)True
B)False
Answer: True
Q3) Accounting transactions must always be realized prior to being recognized. A)True
B)False
Answer: False
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4
Chapter 3: Statements of Income and Comprehensive Income
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130 Verified Questions
130 Flashcards
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Sample Questions
Q1) An income statement showing depreciation expense a line item is showing its expenses by nature.
A)True
B)False
Answer: False
Q2) Maston Inc.,decided to dispose of its telephone manufacturing segment on March 1,Year 1 for $200,000 (book value of net assets,$150,000).The disposal date is June 1,Year
2.Income of the segment for the first two months of Year 1 was $33,000; and for the remainder of Year 1,$107,000.Estimated income for Year 2 to the disposal date is $64,000.Ignoring taxes,calculate the income or loss from discontinued operations and any gain or loss from the disposal of discontinued operations on the income statement of Maston Inc.,for the year ended December 31,Year 1.
Answer: 11ea74c8_fa31_cbf7_9904_cd0a99c0e182_TB2439_00
Q3) Unusual or infrequent items should be reported separately,but not net of income tax,and not as an extraordinary item.
A)True
B)False
Answer: True
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Chapter 4: Statements of Financial Position and Changes in Equity; Disclosure Notes
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131 Verified Questions
131 Flashcards
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Sample Questions
Q1) A statement of changes in Equity is mandatory under both IFRS and ASPE. A)True
B)False
Q2) The purchase of a machine on credit was recorded as a debit to Machinery,a debit to Discount on note payable,and a credit to Notes payable.Under IFRS,at the end of the accounting period,any unamortized debit balance in the discount account should be reported as a(n):
A)asset.
B)a direct reduction to the liability - without using a contra account.
C)expense.
D)liability.
Q3) The shareholders' equity section of a consolidated statement of financial position shows the shareholder equity attributable to the parent. A)True
B)False
Q4) Under ASPE,Biological Assets are shown separately from Property,Plant & Equipment at their Fair Value less costs to sell.
A)True
B)False
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Chapter 5: The Statement of Cash Flows
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177 Verified Questions
177 Flashcards
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Sample Questions
Q1) Under IFRS,term preferred shares near their maturity date may be classified as cash equivalents for purposes of the Statement of Cash Flows.
A)True
B)False
Q2) Assume cash paid to suppliers for 2011 is $350,000; merchandise inventory increased by $5,000 during the year,and accounts payable decreased by $10,000 during the year.What was cost of goods sold for 2011?
A)$335,000
B)$345,000
C)$355,000
D)$365,000
Q3) Which of the following causes a net change in cash?
A)Write-off of a bad debt
B)Payment of a long-term debt by issuing common shares
C)Declaration of a cash dividend
D)Declaration and issuance of a stock dividend
E)Payment of a cash dividend declared in a previous period
Q4) The records of CDE provided the following information for the period ended December 31,2012:
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Chapter 7: Financial Assets: Cash and Receivables
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119 Verified Questions
119 Flashcards
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Sample Questions
Q1) With compounding,the interest earned each period on an amount invested at a fixed rate of interest increases over time.
A)True
B)False
Q2) Which of the following procedures is the least essential attribute of a cash disbursement control system?
A)Supervision of all cash disbursement and record keeping functions
B)Establishment of a petty cash system
C)Use of multiple bank accounts
D)All disbursements (except petty cash) are required to be made by cheque
E)Cheques are signed only when supported by adequate documentation and verification
Q3) Using the same rate of annual interest over the same total time period,quarterly compounding will result in a larger accumulated amount than will monthly compounding.
A)True B)False
Q4) Simple interest is always computed based on the principal amount.
A)True
B)False
Page 8
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Chapter 8: Cost-Based Inventories and Cost of Sales
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169 Verified Questions
169 Flashcards
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Sample Questions
Q1) In the FIFO retail method,what does the ending inventory for any period represent?
A)The ending inventory at approximately the current cost.
B)The ending inventory at the beginning of the year cost dollars.
C)The ending inventory at the average cost dollars.
D)The sum of inventory layers from previous periods.
E)The sum of inventory layers each costed at current dollars found by applying the current years' selling prices.
Q2) Which of the following items should not be included in the inventory at year-end?
A)Goods that are owned by a company
B) Goods returned by a customer
C)Goods out on consignment
D)Goods held on consignment for sale on commission
Q3) Goods held on consignment from a supplier should be included in the ending inventory count of the retailer.
A)True
B)False
Q4) Explain how ethical issues may arise in the application of Lower of Cost & NRV rules.
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Chapter 9: Property,Plant,and Equipment; Intangibles; and Goodwill
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191 Verified Questions
191 Flashcards
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Sample Questions
Q1) With respect to exploration and evaluation assets,costs incurred in the pre-exploration and evaluation phase are:
A)expensed.
B)capitalized.
C)expensed or capitalized.
D)expensed under IFRS and expensed or capitalized under ASPE.
Q2) In December 2000,RJ exchanged an old bottling machine,which cost $60,000 and was two-thirds depreciated,for a similar used machine having a current fair value of $24,000,and received a cash difference of $1,000.What is the amount of gain that RJ should recognize on this exchange in the year ended December 31,2000?
A)$5,000
B)$8,000
C)$0
D)$3,000
Q3) Property taxes accrued u to the date of the purchase of a capital asset should be included in the recorded cost of the asset.
A)True
B)False
Page 10
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Chapter 10: Depreciation,Amortization,and Impairment
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Sample Questions
Q1) (a) On July 1,2001,XY purchased a machine that cost $22,000.It has a four-year life and $2,000 estimated residual value.It is to be depreciated using the sum-of-the-years'-digits method.Give the amortization entry at the end of 2001 and 2002 (end of the accounting period).XY has a December,31 year-end (b) Refer to the data in the above situation.Suppose instead the machine is to be depreciated using the service-hours method and its estimated life is 20,000 hours.Give the amortization entry at the end of 2001 and 2002,assuming it was used 3,000 hours during 2001 and 7,000 hours during 2002.
Q2) Under both IFRS and ASPE,if the fair value of a reporting unit is less than its book value,an impairment loss has automatically occurred and no further impairment testing is required.
A)True
B)False
Q3) During 2014,King Co.sold equipment that had cost $82,000 for $49,200.This resulted in a gain of $4,300.The balance in Accumulated Amortization--Equipment was $270,000 on January 1,2014,and $258,000 on December 31.No other equipment was disposed of during 2014.Calculate the amount of amortization expense for 2014.King Co.has a calendar year-end and adjusting entries are only made at year-end.
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11
Chapter 11: Financial Instruments: Investments in Debt and Equity Securities
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Sample Questions
Q1) On 1-1-2014 Sea Inc.purchased 40% of Gull Corporation for $30,000.At that time,Gull's owners' equity was $4,000,and Gull had the following assets with market values exceeding book value by the following amounts: Land $20,000 Buildings 30,000 (10 years life remaining) Patent 10,000 (5 years life remaining) Gull earned $10,000 in 2014 and paid $20,000 dividends.We amortize all intangibles over 5 years.What is the 2014 ending balance in the Investment in Gull account?
A)$23,330
B)$23,120
C)$23,000
D)$33,400
Q2) Amortized cost investments must have contractual terms that give rise to cash flows on specific dates.
A)True B)False
Q3) Impairment tests are required for all investments except those designated FVTPL. A)True B)False
Q4) List 3 factors that exhibit evidence of the existence of significant influence.
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