Test Bank for Intermediate Accounting IFRS, 4th Edition by Donald E. Kieso

, TESTyBANK




IntermediateyFinanci
alyAccountingyParty1
A




ZEUSyVERNONyB.yMILLAN

, ALLyRIGHTSyRESERVEDy2
015


Noypartyofythisyworkycoveredybyytheycopyrighty
hereonymayybeyreproducedyoryusedyinyanyyfor
myorybyyanyymeansy-
yelectronicyorymechanical,yincludingyphotocop

yingy–
ywithoutytheywrittenypermissionyofytheyauthor.




ISBNy978-621-95096-0-2


Publishedyby:
BANDOLINyENTERPRISE
No.y100yMontebelloyVillage,yBakakengySur,yBaguioyCityy2600,yPhilippines

TABLEyOFyCONTENTS

CHAPTERy1
OVERVIEWyOFyACCOUNTING ........................................................... 3
CHAPTERy 1:yTHEORYy OFy ACCOUNTSy REVIEWER .............................................. 3
CHAPTERy 1y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 22
CHAPTERy2
THEyACCOUNTINGyPROCESS .......................................................... 24
CHAPTERy 2:yMULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 24
CHAPTERy 2:yTHEORYy OFy ACCOUNTSy REVIEWER ........................................... 26
CHAPTERy 2y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 36
CHAPTERy3
THEyCONCEPTUALyFRAMEWORKyFORyFINANCIALyREPORTINGy36
CHAPTERy 3:yMULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 36
CHAPTERy 3:yTHEORYy OFy ACCOUNTSy REVIEWER ........................................... 37
CHAPTERy 3y -y SUGGESTEDy ANSWERSy TOy REVIEWy THEORYy QUESTIONS .... 54
CHAPTERy4
CASHy&yCASHyEQUIVALENTS ....................................................... 54
CHAPTERy 4:yMULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 54
CHAPTERy 4:yTHEORYy OFy ACCOUNTSy REVIEWER ........................................... 57
CHAPTERy 4y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 65
CHAPTERy5
RECEIVABLESy(PARTy1) ................................................................. 66
CHAPTERy 5:yMULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 66
CHAPTERy 5:yTHEORYy OFy ACCOUNTSy REVIEWER ........................................... 69
CHAPTERy 5y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 75
CHAPTERy6
RECEIVABLESy(PARTy2) ................................................................. 75
CHAPTERy 6:yMULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 75
CHAPTERy 6:yTHEORYy OFy ACCOUNTSy REVIEWER ........................................... 78
CHAPTERy 6y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 82
CHAPTERy7

, CHAPTERy 7y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 92
CHAPTERyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy8yINVENTORI
ES ...................................................................................................... 92
CHAPTERy 8:y MULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 92
CHAPTERy 8:y THEORYy OFy ACCOUNTSy REVIEWER .......................................... 97
CHAPTERy 8y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 109
CHAPTERy9
INVESTMENTSy(PARTy1) .............................................................. 109
CHAPTERy 9:y MULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 109
CHAPTERy 9:y THEORYy OFy ACCOUNTSy REVIEWER ........................................112
CHAPTERy 9y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 122
CHAPTERy10
INVESTMENTSy(PARTy2) .............................................................. 122
CHAPTERy 10:y MULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 122
CHAPTERy 10:y THEORYy OFy ACCOUNTSy REVIEWER......................................127
CHAPTERy 10y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 134
CHAPTERy11
INVESTMENTSy(PARTy3) .............................................................. 135
CHAPTERy 11:y MULTIPLEy CHOICEy –y COMPUTATIONALy (SETy B)y –y (FORy CLASSROOMy INSTRUCTIONy PURPOSES) 135
CHAPTERy 11:y THEORYy OFy ACCOUNTSy REVIEWER......................................135
CHAPTERy 11y -y SUGGESTEDy ANSWERSy TOy THEORYy OFy ACCOUNTSy QUESTIONS 137

Chaptery1yOverv
iewyofyAccounting
Chaptery1:yTheoryyofyAccountsyReviewe
ryDefinitionyofyAccounting
1. Accountingyhasybeenygivenyvariousydefinitions,ywhichyofytheyfollowingyisynotyoneyofythoseydefinitions
a. Accountingyisyayserviceyactivity.yItsyfunctionyisytoyprovideyquantitativeyinformation,yprimarilyyfinancialyinyna
ture,yaboutyeconomicyentitiesythatyisyintendedytoybeyusefulyinymakingyeconomicydecisions.
b. Accountingyisytheyartyofyrecording,yclassifying,yandysummarizingyinyaysignificantymanneryandyinytermsyofymo
ney,ytransactionsyandyeventsywhichyare,yinypartyofyatyleast,yofyayfinancialycharacteryandyinterpretingytheyresul
tsythereof.
c. Accountingyisyaysystematicyprocessyofyobjectivelyyobtainingyandyevaluatingyevidenceyregardingyassertionsya
bouty economicy actionsy andy eventsy toy ascertainy they degreey ofy correspondencey betweeny thesey assertionsya
ndyestablishedycriteriayandycommunicatingytheyresultsytoyinterestedyusers.
d. Accountingyisytheyprocessyofyidentifying,ymeasuring,yandycommunicatingyeconomicyinformationytoypermityin
formedyjudgmentyandydecisionsybyyusersyofyinformation.

2. Ity isy they firstyyprocessy usedy iny accounting.y Ity refersy toy they identificationy ofy eventsy asy toy whethery theyy arey
recognizedyorynotyinytheyfinancialystatements.
a. Identifying b.yMeasuringy c.yCommunicating d.yAuditing

3. Theyfollowingystatementsycorrectlyyreferytoytheyaccountingyprocess.
I. Measuringyisytheyaccountingyprocessyofyanalyzingybusinessyactivitiesyasytoywhetheryorynotytheyywillybeyrecog
nizedyinytheybooks.
II. Recognitionyrefersytoytheyprocessyofyincludingytheyeffectsyofyanyeventyinytheytotalsyofytheystatementyofyfinanci
alypositionyorytheystatementyofyprofityorylossyandyotherycomprehensiveyincomeythroughy memoyentries.
III. Disclosureyofyeventsyinytheynotesytoyfinancialystatementywithoutyincludingyinytheytotalsyofytheystatementyofyfi
nancialypositionyorystatementyofyprofityorylossyandyotherycomprehensiveyincomeyisynotyanyapplicationyofytheyr
ecognitionyprinciple.
IV. Anyaccountableyeventyisyanyeventythatyhasyanyeffectyonytheyassets,yliabilitiesyoryequityyofyanyentityyandyitsyeff
ectycanybeymeasuredyreliably.
V. Sociologicalyandypsychologicalymattersyareywithinytheyscopeyofyaccounting.
a.yI,yII,yIII,yIV,yV b.yI,yII,yIII,yIV c.yIV d.yIII,yIV

TypesyofyEvents