Which statement is correct?
A. Correction of accounting errors proves that management bias exists in reporting.
B. Accounting errors are corrected prospectively in the financial statements.
C. Accounting policy changes should reflect changes in economic circumstances.
D. Changes in accounting e...
Accounting Quizzes 353 || A+ Guaranteed.
Which statement is correct?
A. Correction of accounting errors proves that management bias exists in reporting.
B. Accounting errors are corrected prospectively in the financial statements.
C. Accounting policy changes should reflect changes in economic circumstances.
D. Changes in accounting estimates are corrected retrospectively in the statements. correct
answers C. Accounting policy changes should reflect changes in economic circumstances
When using IFRS, in determining the impairment amount for a loan receivable, the new/revised
cash flows should be discounted using which rate of interest?
- An accounting method that records transactions when they have an economic effect on the
company.
- Accounting estimates or professional judgment are not necessary with accrual accounting.
- A true measure of economic or accounting income is possible with accrual accounting.
-A method of accounting that does not require accruals for amounts due or outstanding at year-
end. correct answers An accounting method that records transactions when they have an
economic effect on the company.
What is meant by earnings quality?
- A measure of how closely earnings correspond to earnings reported without management bias.
- A measure to determine management bias by comparing actual reported profits with 'true'
earnings.
- A measure to determine management bias by comparing reported income to actual cash flows.
- A measure of how closely expense accruals correspond to actual expenses without management
bias. correct answers A measure of how closely earnings correspond to earnings reported without
management bias.
Which statement is correct about expenses in the comprehensive income statement?
A. Expenses can be classified in any manner under IFRS.
B. The function of expense format classifies expenses based on their use.
C. Expenses should be classified based on their materiality.
D. Some function of expense categories are depreciation or employee costs. correct answers B.
The function of expense format classifies expenses based on their use.
Under IFRS, income from discontinued operations would be shown as a component of:
A. other comprehensive income
B. profit
C. accumulated other comprehensive income
D. revenue correct answers B. profit
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