Test Bank for Intermediate Accounting Volume 2, 9th Canadian Edition by Beechy

Complete Answers Included
Vol 2 (Chap 12 - 22) ✅
Chap 12 9ce Beechy
TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.
1) Conceptually, liabilities constitute a present obligation as a result of a past event and entail an
expected future sacrifice of assets or services.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-01 Liability Definition and Categories
Source : Chapter 12 Test Bank - Static > TB 12-01 Conceptually, liabilities constitute a prese...



2) Under ASPE, only legal obligations are recognized.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Learning Objective : 12-06 Explain disclosure requirements for financial liabilities, provisions, and
Topic : 12-01 Liability Definition and Categories
Topic : 12-09 Disclosure and Statement of Cash Flows
Source : Chapter 12 Test Bank - Static > TB 12-02 Under ASPE, only legal obligations are recog...



3) A reasonable expectation on the part of a company's stakeholders arising from a company's
past practices or behaviour may constitute a constructive obligation in certain instances.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-02 Common Financial Liabilities
Source : Chapter 12 Test Bank - Static > TB 12-03 A reasonable expectation on the part of a co...




1

,4) A contingency may become a provision if the likelihood of the contingent event greatly
increases.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Learning Objective : 12-02 Distinguish between a financial liability, a contingency, and a provision
Topic : 12-02 Common Financial Liabilities
Topic : 12-04 Non-Financial Liabilities: Provisions
Source : Chapter 12 Test Bank - Static > TB 12-04 A contingency may become a provision if the ...



5) Under IFRS, most financial liabilities are valued at fair value.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-02 Common Financial Liabilities
Source : Chapter 12 Test Bank - Static > TB 12-05 Under IFRS, most financial liabilities are v...



6) An improvement to a company's credit rating under IFRS will lead to a reduction in the
carrying amount of any financial liabilities and a gain being reported in OCI.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-02 Common Financial Liabilities
Source : Chapter 12 Test Bank - Static > TB 12-06 An improvement to a company's credit rating...




2

,7) Loan guarantees are only recorded if they are likely to be paid.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-02 Common Financial Liabilities
Source : Chapter 12 Test Bank - Static > TB 12-07 Loan guarantees are only recorded if they ar...



8) Accrued liabilities made due to routine operating expenses are not normally discounted.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-01 Define and distinguish between financial and non-financial liabilities and
Topic : 12-02 Common Financial Liabilities
Topic : 12-01 Liability Definition and Categories
Source : Chapter 12 Test Bank - Static > TB 12-08 Accrued liabilities made due to routine oper...



9) For a small population, the best estimate for the amount of a provision that must be
recognized is the expected value of the possible outcomes.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-02 Distinguish between a financial liability, a contingency, and a provision
Topic : 12-04 Non-Financial Liabilities: Provisions
Topic : 12-05 Examples of Provisions
Source : Chapter 12 Test Bank - Static > TB 12-09 For a small population, the best estimate fo...




3

, 10) Under IFRS, provisions are always recorded at their expected value.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-02 Distinguish between a financial liability, a contingency, and a provision
Topic : 12-04 Non-Financial Liabilities: Provisions
Source : Chapter 12 Test Bank - Static > TB 12-10 Under IFRS, provisions are always recorded a...



11) For a large population, the best estimate for the amount of a provision that must be
recognized is the most likely outcome with respect to the expected value and cumulative
probabilities.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-02 Distinguish between a financial liability, a contingency, and a provision
Topic : 12-04 Non-Financial Liabilities: Provisions
Topic : 12-05 Examples of Provisions
Source : Chapter 12 Test Bank - Static > TB 12-11 For a large population, the best estimate fo...



12) Under ASPE, contingent liabilities which are more likely than not, are accrued at the lowest
end of the range.
⊚ true
⊚ false

Question Details
Accessibility : Screen Reader/Keyboard/CC
Bloom's : Remember
Difficulty : Easy
Learning Objective : 12-06 Explain disclosure requirements for financial liabilities, provisions, and
Topic : 12-09 Disclosure and Statement of Cash Flows
Source : Chapter 12 Test Bank - Static > TB 12-12 Under ASPE, contingent liabilities which are...




4