TEST BANK for Advanced Accounting in Canada, 1st Canadian Edition by Nathalie Johnstone

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Advanced Accounting in Canada, 1st Canadian Edition
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TEST BANK For Advanced Accounting In Canada, 1st Canadian
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jrjr Edition By Nathalie Johnstone
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Prose1 Stuvia
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,Test Bank Table of Contents
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Chapter Title

Chapter 1 jr Introduction to Advanced Financial Accounting
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Chapter 2 jr Accounting for Non-Controlled Investments
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Chapter 3 jr Introduction to Business Combinations
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Chapter 4 jr Consolidated Financial Statements on Acquisition Date
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Chapter 5 jr Consolidated Financial Statements Subsequent to Acquisition
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Chapter 6 jr Intercompany Transactions jr jr




Chapter 7 jr Investments in Associates and Joint Ventures
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Chapter 8 jr Translation of Foreign Operations and Foreign Currency
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Chapter 9 jr Accounting for Derivatives and Hedging Activities
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Chapter 10 jr Accounting for Not-for-Profit Organizations
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Chapter 11 jr Accounting for Government Organizations
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Test Bank jr




Advanced Accounting in Canada, 1st Canadian Edition
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Chapter 1: Introduction to Advanced Financial Accounting
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,Part I: Multiple Choice Questions (25 Questions)
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1) A private company in Canada that is closely held, has no debt, and wants to
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jr simplify the accounting process is most likely to report under which part of the
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jr CPA Canada Handbook?
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A) Part II — Accounting Standards for Private Enterprises (ASPE)
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B) Part IV — Accounting Standards for Pensions
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C) Part I — International Financial Reporting Standards (IFRS)
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D) Part III — Accounting Standards for Not-for-Profit Organizations
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Answer: A jr




Explanation: Part II of the CPA Canada Handbook contains Accounting Standards for jr jr jr jr jr jr jr jr jr jr jr




jr Private Enterprises (ASPE), which was developed specifically for private companies to
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jr provide a simpler, more cost-effective reporting framework. Private companies that are
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jr closely held with users who have direct access to management do not require the complex
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jr disclosures of IFRS, making ASPE the most appropriate choice . jr jr jr jr jr jr jr jr jr




2) Which of the following enterprises must report under IFRS in Canada?
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A) All corporations, government agencies and private companies
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B) Public companies and private companies whose shareholders' equity exceeds
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jr $500,000,000
C) Public companies, private companies and not-for-profit organizations
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D) Publicly accountable enterprises
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Answer: D jr




Explanation: In Canada, publicly accountable enterprises are required to use International
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jr Financial Reporting Standards (IFRS). Publicly accountable enterprises include entities
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, jr whose debt or equity instruments are traded in a public market or that hold assets in a
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jr fiduciary capacity for a broad group of outsiders as one of their primary businesses .
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3) What are the four parts of the CPA Canada Handbook — Accounting?
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A) Part I (IFRS), Part II (ASPE), Part III (Not-for-Profit), Part IV (Pension Plans)
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B) Part I (Public Companies), Part II (Private Companies), Part III (NPOs), Part IV
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jr (Government)
C) Part I (ASPE), Part II (IFRS), Part III (Pensions), Part IV (NPOs)
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D) Part I (Corporations), Part II (Partnerships), Part III (Sole Proprietorships), Part IV (Trusts)
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Answer: A jr




Explanation: The CPA Canada Handbook is organized into four parts: Part I contains
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jr International Financial Reporting Standards (IFRS) applicable to publicly accountable
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jr enterprises; Part II contains Accounting Standards for Private Enterprises (ASPE); Part III
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jr contains standards for not-for-profit organizations; and Part IV contains accounting
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jr standards for pension plans . jr jr jr jr




4) In 2011, Canada adopted IFRS for publicly accountable enterprises. What was the
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jr primary rationale for this decision? jr jr jr jr




A) To reduce the cost of financial reporting for Canadian companies
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B) To improve consistency and comparability in international capital markets
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C) To eliminate the need for Canadian accounting standards entirely
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D) To align with United States accounting requirements
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Answer: B jr




Explanation: As the global economy expanded, the Accounting Standards Board (AcSB)
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jr chose to adopt IFRS in Canada to improve consistency and comparability in international
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