Intermediate Accounting Volume 2 Seventh Canadian Edition Test Bank
Intermediate Accounting Volume 2 Seventh Canadian Edition Test Bank is your go-to resource for exam success, featuring expert insights and real-world applications.
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Name___________________________________
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.
1) _______
2) Under ASPE, only legal obligations are recognized. 2) _______
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.
3) _______
4) A contingency may become a provision if the likelihood of the contingent event greatly
increases.
4) _______
5) Under IFRS, most financial liabilities are valued at Fair Value. 5) _______
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.
6) _______
7) Loan guarantees are only recorded if they are likely to be paid. 7) _______
8) Accrued liabilities made due to routine operating expenses are not normally discounted. 8) _______
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.
9) _______
10) Under IFRS, provisions are always recorded at their expected value. 10) ______
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.
11) ______
12) Under ASPE, contingent liabilities which are more likely than not, are accrued at the
lowest end of the range.
12) ______
13) Contingent assets may be recorded under ASPE but not under IFRS. 13) ______
14) Executory contracts seldom require a journal entry, while onerous contracts do. 14) ______
15) Discounting is not required when the time value of money is immaterial or if the amount
and timing of cash flows is highly uncertain.
15) ______
16) Financial liabilities are initially recognized at fair value and at cost, amortized cost or
fair value post-acquisition.
16) ______
17) A company decides to relocate a group from a discontinued business segment to a
division with ongoing operations. The expenses incurred in doing so would qualify as a
restructuring charge.
17) ______
18) Under the warranty expense approach, there should be no income statement effects for warranty
Name___________________________________
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.
1) _______
2) Under ASPE, only legal obligations are recognized. 2) _______
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.
3) _______
4) A contingency may become a provision if the likelihood of the contingent event greatly
increases.
4) _______
5) Under IFRS, most financial liabilities are valued at Fair Value. 5) _______
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.
6) _______
7) Loan guarantees are only recorded if they are likely to be paid. 7) _______
8) Accrued liabilities made due to routine operating expenses are not normally discounted. 8) _______
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.
9) _______
10) Under IFRS, provisions are always recorded at their expected value. 10) ______
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.
11) ______
12) Under ASPE, contingent liabilities which are more likely than not, are accrued at the
lowest end of the range.
12) ______
13) Contingent assets may be recorded under ASPE but not under IFRS. 13) ______
14) Executory contracts seldom require a journal entry, while onerous contracts do. 14) ______
15) Discounting is not required when the time value of money is immaterial or if the amount
and timing of cash flows is highly uncertain.
15) ______
16) Financial liabilities are initially recognized at fair value and at cost, amortized cost or
fair value post-acquisition.
16) ______
17) A company decides to relocate a group from a discontinued business segment to a
division with ongoing operations. The expenses incurred in doing so would qualify as a
restructuring charge.
17) ______
18) Under the warranty expense approach, there should be no income statement effects for warranty
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Subject
Accounting