Intermediate Accounting Volume 1 – 8th Edition by Thomas H. Beechy, Joan E. Conrod, and Elizabeth Farrell – Complete Test Bank with Answers for All Chapters

TEST BANK
Intermediate Accounting Volume 1 8E Thomas H. Beechy,
Joan E. Conrod, Elizabeth Farrell, Ingrid
McLeod-Dick, Kayla Tomulka, Romi-Lee Sevel

,Chapter 1

Student name:
1) The main purpose of financial accounting is to communicate useful financial information to
decision-makers both inside and outside of the business organization.
⊚ true


⊚ false

2) The Canadian Business Corporations Act mandates that all incorporated companies in
Canada follow IFRS.
⊚ true


⊚ false
3) Private companies in Canada may choose between IFRS or ASPE.
⊚ true


⊚ false

4) Canada has adapted its own pre-existing standards for public companies to IFRS, while the
U.S has adopted IFRS completely.
⊚ true


⊚ false

5) A disclosed basis of accounting (DBA) is acceptable if a company's financial statements are
prepared solely for internal use.
⊚ true


⊚ false

,6) Only publicly traded companies in Canada are required to adopt IFRS.
⊚ true


⊚ false

7) Earnings quality is said to be high when most of a company's earnings are the result of its
continuing operations.
⊚ true


⊚ false
8) Income tax deferral is illegal in Canada.
⊚ true


⊚ false
9) In Canada, income for tax and accounting purposes may be different.
⊚ true


⊚ false
10) External users of a company's financial statements may have conflicting objectives.
⊚ true


⊚ false
11) In Canada, IFRS standards were essentially converged with Canadian GAAP.
⊚ true


⊚ false

12) A company's functional currency is always the currency in which the financial statements are
presented.
⊚ true


⊚ false

, 13) It is acceptable for publicly traded Canadian companies to report under US GAAP.
⊚ true


⊚ false

14) In Canada, almost all equity financing for both public and private companies is done through
private placements.
⊚ true


⊚ false
15) IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).
⊚ true


⊚ false

16) Privately held for-profit enterprises with a fiduciary responsibility have a choice between
IFRS and ASPE.
⊚ true


⊚ false

17) Mutual fund companies, which may be privately held, are deemed to have a fiduciary
responsibility and must therefore comply with IFRS.
⊚ true


⊚ false
18) Canadian companies must always present their financial results in Canadian dollars.
⊚ true


⊚ false
19) Canadian corporations are prohibited from using U.S. GAAP.
⊚ true


⊚ false