Exam (elaborations)

AIT707 Midterm exam (questions with answers)

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Course
Nursing (AIT707)

Institution
Thompson River University (TRU )

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Uploaded on January 26, 2021
Number of pages 12
Written in 2019/2020
Type Exam (elaborations)
Contains Questions & answers

ait707
ait707 mid term exam
accounting standards
international accounting standards

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INSTRUCTIONS
Answer the multiple choice and problems (narrative questions, etc.) in you examination booklet
using the instructions for each question. Address all the issues required in each of the following
questions. Each question is worth the stated value. Be sure that all the key points are covered.
Be brief and concise.

PART 1 - MULTIPLE CHOICE 10 MARKS
Select the best answer for each of the following unrelated items. Answer each of these
questions by giving the letter of your choice. For example, if (A) is the best answer for question
1, write “1 (A)”. If more than one answer is given for an item then that item will not be marked.
Incorrect answers will be marked as zero. No account will be taken for any explanations you
offer. Each question is worth one mark.

1. Which of the following would not be a reason to obtain a greater understanding of accounting
practices in other nations?

a. Financial Results are disclosed in different currencies.
b. One needs to be aware of differing disclosure requirements from nation to nation, as this
impacts the preparation of Financial Statements.
c. Income-smoothing may have affected a Foreign Subsidiary’s results; such smoothing
practices are not permitted in North America.
d. Departures from the Historical Cost Principle may be possible in other nations.

Ans: A

2. Which of the following is/are LEAST likely to influence a country’s accounting standards?

a. Taxation Policies.
b. Differing Legal Systems.
c. The currency used.
d. Ties between countries.

Ans: C

3. Which of the following bodies is responsible for the harmonization of international accounting
standards?

a. The European Union. (EU)
b. The Federal Accounting Standards Board (FASB)
c. The International Accounting Standards Board (IASB)
d. The Canadian Institute of Chartered Accountants (CICA).

Ans: C

4. Which of the following does NOT constitute a Business Combination?

, a. A Corp purchases the net assets of B Corp.
b. A Corp enters into a Joint Venture with B Corp.
c. A Corp acquires 51% of B Corp’s voting shares for $1,000,000 in Cash.
d. A Corp acquires 51% of B Corp’s voting shares for future considerations.

Ans: B

5. Which of the following statements is TRUE?

a. All unrealized gains and losses on equity investments are flow through Other Comprehensive
Income.
b. Unrealized gains and losses on held-for-trading securities are included in Other
Comprehensive Income.
c. Unrealized gains and losses on available-for-sale investments are included in Other
Comprehensive Income.
d.Other Comprehensive Income is included in Retained Earnings.

Ans: C

6. Differential reporting is permitted in certain instances for

a. all privately held companies.
b. all publicly held companies.
c. all Canadian companies.
d. Canadian companies consolidating its foreign subsidiaries.

Ans: A

7. Parent Company acquires Sub Company’s common shares for cash. On the date of
acquisition, Sub had Goodwill of $100,000 on its books. Which of the following statements
regarding Sub’s Goodwill on the date of acquisition is correct?

a. Sub’s goodwill is considered an identifiable asset and should therefore be included in Parent
Company’s Purchase Price Discrepancy calculation.
b. Sub’s goodwill is considered an identifiable asset and should therefore be excluded from
Parent Company’s Purchase Price Discrepancy calculation.
c. Sub’s goodwill is not considered an identifiable asset and should therefore be excluded from
Parent Company’s Purchase Price Discrepancy calculation.
d. Sub’s goodwill is not considered an identifiable asset and should therefore be included in
Parent Company’s Purchase Price Discrepancy calculation.

Ans: C

8. Which of the following pertaining to Consolidated Financial Statements is correct?

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