ACG411 Week 4 Final Exam/ACG411 Week 4 Final Exam

ACG411 Week 4 Final Exam

Report this Question as Inappropriate

Question

Question 1

A disclosure note is required for all material loss contingencies for which the probability of loss

is reasonably possible.

True

False

Question 2

P Corp. leased an asset to L Corp. using an operating lease in February. P Corp.'s December 31

statement of cash flows will report:

A cash outflow from investing activities.

A cash outflow from investment activities.

A cash inflow from operating activities.

No cash outflow.

Question 3

When a company's only potential common shares are convertible bonds:

Diluted EPS will be greater if the bonds are actually converted than if they are not converted.

Diluted EPS will be smaller if the bonds are actually converted than if the bonds are not

converted.

Diluted EPS will be the same whether or not the bonds are converted.

The effect of conversion on diluted EPS cannot be determined without additional information.