1. Which of the following statements about a change in accounting policy is not true?

A. A change in accounting policy can only be made when it is required to comply with an accounting standard or interpretation.

B. Changes in accounting policies should be infrequent occurrences.

C. When the change in policy is voluntary, the effects of the change in accounting policy is to be accounted for retrospectively.

D. A change in accounting policy is permissible when the change will result in the financial statements providing reliable and more relevant information.

5. Which one of the following would be an example of a special purpose financial report?

A. A Statement of Profit & Loss prepared for tax reporting.

B. A statement of financial position prepared for use by existing and potential investors, lenders and creditors.

C. A Statement of Profit & Loss prepared by applying the Australian Accounting Standards.

D. Notes to the Financial Statements prepared by applying the Australian Accounting Standards.

6.Which of the following completes this statement: "Derivative financial instruments

A. require a significant initial investment.

B. create rights and obligations that have the effect of transferring between parties to the instrument one or more of the financial risks inherent in an underlying primary financial instrument.

C. include items such as notes receivable, notes payable, put options and call options.

D. derive their value from the accounting standard that underpins their presentation.

22. Hofstede's notion of individualism refers to

A. A preference for achievement, heroism, assertiveness and material success.

B. A society that accepts a hierarchical order in which everyone has a place.

C. A tightly knit social framework where relatives, clan or other in-group look after each other.

D. A preference for a loosely knit social framework wherein individuals care for themselves and their immediate families.

33. Which items are considered share-based payment transactions within the scope of AASB 2?

A. An entity acquires inventory from another entity with payment to be settled at a future date

B. An entity acquires a piece of equipment from another entity in exchange for shares of the entity

C. An entity grants 200 share options to all employees but requires employees to work at least 3 years

D. An entity grants 200 share options to all employees

35.Which one of the following statements about Other Comprehensive Income (OCI) is not true?

A. Many users are thought to ignore OCI as the changes reported are not caused by the operating flows used for predictive purposes.

B. Opinions vary but there is a feeling that OCI has become a dumping ground for anything controversial because of a lack of clear definition of what should be included in the statement.

C.OCI items are transitory in nature.

D. The basis for reporting items in OCI is conceptually sound.

40.There are a number of reasons why international differences will survive beyond the introduction of IFRS. Which one of the following is not one of these reasons?

A. Lower compliance costs.

B. Culture.

C. Differences in legal systems.

D. Strength of the accounting profession.

43.Monroe Ltd acquired a parcel of 50 000 call options in Sunrise Ltd on 1 November 2018.The price of the options was $1.50 each and they may be exercised any time prior to 30 June 2021 at exercise price of $30. On the same data the market price for Sunrise Ltd shares is $25. On Monroe Ltd's balance data-30 June 2019-the company is still holding the options. The market price of the options at that time was $1.90 each and the share price was $27.What is the financial effect of the above transactions on Monroe Ltd's statement of comprehensive income for the year ending 30 June 2019?

A. Increase by $20 000

B. Decrease by $20 000

C. Increase by $150 000

D. Decrease by $150 000

44, An entity that has taken a buy position in a futures contract on a particular item will make a gain when the price of the item decreases

Ture

False