Financial Statements IASB Quiz

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Quiz by rachel_heap_02, updated more than 1 year ago
rachel_heap_02
Created by rachel_heap_02 almost 5 years ago
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Description

Short quiz testing your knowledge of the IASB Conceptual Framework
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Resource summary

Question 1

Question
"Going Concern Basis" is an underlying assumption of financial statements.
Answer
  • True
  • False

Question 2

Question
Using the accrual basis underlying assumption, the effects of transactions and other events are recognised when the cash is received or paid not when they occur.
Answer
  • True
  • False

Question 3

Question
Relevant information is capable of making a difference in the decisions made by users. Relevance requires financial information to be related to what?
Answer
  • An economic decision
  • An entity specific decision

Question 4

Question
The financial information in the financial reports should represent what it purports to represent. Meaning, it should show what really are present and what really happened..
Answer
  • True
  • False

Question 5

Question
There are four possible measurement bases for assets: historical cost, current cost, present value and which other?
Answer
  • Past Cost
  • Net Realisable Value

Question 6

Question
DEFINITION of 'Historical Cost' A measure of value used in accounting in which the price of an [blank_start]asset[blank_end] on the balance sheet is based on its [blank_start]nominal[blank_end] or [blank_start]original[blank_end] cost when acquired by the company.
Answer
  • nominal
  • original
  • asset

Question 7

Question
A method of accounting in which assets are valued on the basis of their current replacement cost, and increases in their [blank_start]value[blank_end] as a result of inflation are excluded from calculations of profit.
Answer
  • value
  • depreciation value

Question 8

Question
With regards to inventory, net realisable value (NRV) is the estimated selling price in the ordinary course of business minus any cost to complete and to sell the goods. NRV is one of the amounts considered when determining the lower of cost or market for items in inventory...
Answer
  • True
  • False

Question 9

Question
The current worth of a future sum of money or stream of cash flows given a specified rate of return. Future cash flows are discounted at the discount rate, and the higher the discount rate, the lower the [blank_start]present value[blank_end] of the future cash flows.
Answer
  • present value
  • past value
  • current value
  • discounted value

Question 10

Question
What does IASB stand for in the IASB Conceptual Framework?
Answer
  • International Accounting Standards Board
  • International Accounting Standards Body
  • International Accountancy Standards Board
  • Independant Accounting Standards Board

Question 11

Question
A method of accounting in which asset are valued on the basis of their current replacement cost.
Answer
  • True
  • False

Question 12

Question
Historical cost is a method of accounting in which assets are valued at their original cost
Answer
  • True
  • False

Question 13

Question
What is the formula for calculating Net Realisable Value (NRV)?
Answer
  • Assets - Liabilities = NRV
  • Expected Sales Price - Selling Costs = NRV
  • Expected Sales Price + Selling Costs = NRV
  • Capital - Selling Costs = NRV
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