Test Bank — Intermediate Accounting, Volume 2, 4th Edition (Lo & Fisher, 2019) | All Chapters 11-19 Covered

TEST BANK
Intermediate Accounting, Volume 2
Kin Lo, George Fisher

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4th Edition
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TEST BANK
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, TABLE OF CONTENTS
Test Bank: Intermediate Accounting Volume 2, 4th Edition
By Kin Lo and George Fisher


VOLUME 2
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CHAPTER 11 Current Liabilities and Contingencies

CHAPTER 12 Non-current Financial Liabilities
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CHAPTER 13 Equities




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CHAPTER 14 Complex Financial Instruments

CHAPTER 15 Earnings Per Share




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CHAPTER 16 Accounting for Income Taxes

CHAPTER 17
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Pensions and Other Employee Future Benefits
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CHAPTER 18 Accounting for Leases
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CHAPTER 19 Statement of Cash Flows
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, Intermediate Accounting, Vol. 2, 4e (Lo/Fisher)
Chapter 11 Current Liabilities and Contingencies

Learning Objective 1

1) Which of the following characteristic is required for a liability under IFRS Framework?
A) A past obligation.
B) A present obligation.
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C) An unknown obligation.
D) A future obligation.
Answer: B
Diff: 1 Type: MC
Skill: Concept
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Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.

2) Which of the following characteristic is required for a liability under IFRS Framework?
A) Arises from a past event.
B) Arises from a non-financial transaction.
C) Arises from a future transaction.
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D) Arises from a forecasted transaction.
Answer: A
Diff: 1 Type: MC
Skill: Concept
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Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.

3) Which of the following characteristic is required for a "liability" under IFRS Framework?
A) Expected to result in the inflow of economic benefits.
B) Expected to result in the inflow of economic benefits that are measurable.
C) Expected to result in the outflow of resources embodying economic benefits.
D) Expected to result in the outflow of economic benefits that are virtually certain.
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Answer: C
Diff: 1 Type: MC
Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.

4) Which of the following groups includes only financial liabilities?
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A) Accounts payable, Notes payable, Warranties payable.
B) Bank loan, Bonds payable, Finance lease obligation.
C) Accounts payable, HST payable, Bonds payable.
D) Bank overdraft, USD bank loan, Obligation under customer loyalty plan.
Answer: B
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Diff: 1 Type: MC
Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.

, 5) Which of the following is correct about a "liability" under IFRS Framework?
A) A future obligation arising from past events, the settlement of which is expected to result in an inflow
of resources.
B) A present obligation arising from past events, the settlement of which is expected to result in an inflow
of resources.
C) A past obligation arising from past events, the settlement of which is expected to result in an outflow
of resources.
D) A present obligation arising from past events, the settlement of which is expected to result in an
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outflow of resources.
Answer: D
Diff: 2 Type: MC
Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.
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6) Which is an example of a liability?
A) The decision to borrow $150,000 from the ABC Bank on January 15, 2019.
B) Withdrawing $10,000 from the operating line of credit on January 15, 2019.
C) Selecting the supplier to provide the raw materials for the manufacturing process.
D) Choosing the site for a future plant expansion from a list of several possible choices.
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Answer: B
Diff: 2 Type: MC
Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.
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7) Which of the following is a financial liability?
A) A magazine publisher's obligation to provide the magazine monthly for an agreed upon period.
B) Warranties.
C) Accounts payable.
D) Income taxes payable.
Answer: C
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Diff: 2 Type: MC
Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.

8) Which statement is correct under the IFRS definition for a "liability"?
A) The obligating event must be probable before the liability can be recognized.
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B) The obligating event must be virtually certain before the liability can be recognized.
C) A reliable measure of the obligation must exist before the liability can be recognized.
D) A precise measure of the obligation must exist before the liability can be recognized.
Answer: C
Diff: 2 Type: MC
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Skill: Concept
Objective: 11.1 Describe the nature of liabilities and differentiate between financial and non-financial liabilities.