MCQ On IFRS Vs GAAP

10 Questions | Total Attempts: 323

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MCQ On IFRS Vs GAAP

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Questions and Answers
  • 1. 
    What are the two main financial reporting standard setting bodies? 
    • A. 

      IFRS and US GAAP

    • B. 

      IASB and FASB

    • C. 

      SEC and FSA

  • 2. 
    Under ******, impairment must be tested annually. 
    • A. 

      IFRS

    • B. 

      US GAAP

    • C. 

      Both A and B

  • 3. 
    Under IFRS, interest received is reported as what type of cash flow?
    • A. 

      Operating only

    • B. 

      Financing only

    • C. 

      Investing only

    • D. 

      Operating or Financing

    • E. 

      Operating or Investing

    • F. 

      Financing or Investing

  • 4. 
    Operating Profit Margin is equal to: 
    • A. 

      Operating profit / revenue

    • B. 

      EBIT / net sales

    • C. 

      Both A and B

  • 5. 
    Under US GAAP, if an asset is impaired, it is written down to: 
    • A. 

      The recoverable amount

    • B. 

      Fair value

  • 6. 
    Available-for-sale securities are reported on the balance sheet at: 
    • A. 

      Fair value, but not reported on the income statement until sold

    • B. 

      Fair value, and unrealized gains/losses are recognized on the income statement

    • C. 

      Fair value, and any unrealized gains/losses are reported as other comprehensive income

  • 7. 
    Held-for-trading securities are reported on the balance sheet at:
    • A. 

      Fair value

    • B. 

      Amortized cost

    • C. 

      Unamortized cost

  • 8. 
    Under *******, an asset is impaired when its carrying value exceeds the recoverable amount. The recoverable amount is the greater of fair value less selling costs and the value in use (PV of expected cash flows). 
    • A. 

      IFRS

    • B. 

      US GAAP

    • C. 

      Both A and B

  • 9. 
    Which body uses UNDISCOUNTED cash flows to determine whether or not an asset is impaired?
    • A. 

      IFRS

    • B. 

      US GAAP

    • C. 

      Both A and B

  • 10. 
    Under *******, loss recoveries are permitted as long as they aren't above historical cost. Under *******, loss recoveries are not allowed for assets held-for-use.
    • A. 

      IFRS / US GAAP

    • B. 

      US GAAP / IFRS

    • C. 

      US GAAP / neither body

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