1. [单选题]Faithful representation is a fundamental characteristic of useful information within the IASB’s Conceptual framework for financial reporting.
A. Which of the following accounting treatments correctly applies the principle of faithful representation?
B. Reporting a transaction based on its legal status rather than its economic substance
C. Excluding a subsidiary from consolidation because its activities are not compatible with those of the rest of the group
D. Recording the whole of the net proceeds from the issue of a loan note which is potentially convertible to equity shares as debt (liability)
E. Allocating part of the sales proceeds of a motor vehicle to interest received even though it was sold with 0% (interest free) finance
2. [单选题]15 What journal entry is required to record goods taken from inventory by the owner of a business?
A. Debit Drawings
B. Debit Sales
C. Debit Drawings
D. Debit Purchases
3. [单选题]6 Ordan received a statement from one of its suppliers, Alta, showing a balance due of $3,980. The amount due
according to the payables ledger account of Alta in Ordan’s records was only $230. Comparison of the statement and the ledger account revealed the following differences: 1 A cheque sent by Ordan for $270 has not been allowed for in Alta’s statement. 2 Alta has not allowed for goods returned by Ordan $180. 3 Ordan made a contra entry, reducing the amount due to Alta by $3,200, for a balance due from Alta in Ordan’s receivables ledger. No such entry has been made in Alta’s records. What difference remains between the two companies’ records after adjusting for these items?
A. $460
B. $640
C. $6,500
D. $100
4. [单选题]The following information is available for a manufacturing company which produces multiple products:
A. (i) The product mix ratio
B. (ii) Contribution to sales ratio for each product
C. (iii) General fixed costs
D. (iv) Method of apportioning general fixed costs
E. Which of the above are required in order to calculate the break-even sales revenue for the company?
F. All of the above
G. (i), (ii) and (iii) only
H. (i), (iii) and (iv) only
I. (ii) and (iii) only
5. [单选题]20 IAS 2 Inventories defines the extent to which overheads are included in the cost of inventories of finished goods.
Which of the following statements about the IAS 2 requirements in this area are correct? 1 Finished goods inventories may be valued on the basis of labour and materials cost only, without including overheads. 2 Carriage inwards, but not carriage outwards, should be included in overheads when valuing inventories of finished goods. 3 Factory management costs should be included in fixed overheads allocated to inventories of finished goods.
A. All three statements are correct
B. 1 and 2 only
C. 1 and 3 only
D. 2 and 3 only
