20 small questions

The assesses the cash return to shareholders compared with the amount of money they have invested to earn that cash return. In one year, PBIT = $1M, total assets = $8M, current liabilities = $3M. Return on capital employed (ROCE) = %. The financial statements should show the overall financial reality fo the entity, rather than the legal form of transaction. This situation refers to application of: Select one: O a. Substance over form O b. Historical cost O C. materiality O d. accrual accounting is the excess of the amount transferred plus the amount of non-controlling interests over the fair value of the net assets of the subsidiary. A proportion of the net assets of subsidiaries in fact belong to investors from outside the group. This is called non-controlling intere Cash flow activities include: Select one: a. Investing activities O b. Operating activities C. All the above O d. Financing activities Intra-group trading can give rise to unrealised profit that is eliminated on consolidation. Select one: O True False Short-term loan (with interest rate 10%): $1M; Longer-term loan (with interest rate 3%): $3M; Non-interest loan: $2M; Share capital: $1M; Gearing ratio is (keep 2 decimal places, like 2.00, 2.15, 3.20) You are provided with following information about a company: Cash: $1,000; Inventory: $500; Account receivable: $600; Short-term loan: $500 Based on the above information, the acid test ratio is (presented to two decimal places, like 3.10, 2.00, 2.25). You are provided with following information about a company: Cash: $1,000 Inventory: $500 Account receivables: 600 short-term loan: $500 Based on the above information, the current ratio is (presented to two decimal places, like 3.10, 2.00, 2.26). Deferred incon is an accounting measure used to match the tax effects of transactions with their impacts. The balance sheet (or statement of financial position) includes the categories of Select one: a. Assets O b. Liabilities O C. Equity d. All the above A machine purchased for a business cost $2,000. It is expected to las for 2 years and then be sold for scrap for $400. Usage over the two years is expected to be: Year 1: 170 days; Year 2: 230 days. Under the usage method, the depreciation for the second year is $ Answer: A company has an item of land carried in its books at $1,000. Two years ago a slump in land made its carrying value reduced from $1,200. (That is, its book value should be $1,200; but this slump made its book value down to $1,000 two years ago). There has been a surge in land prices in the current year, however, the land is now worth $1,800. There should be a credit entry in revaluation surplus. The amount of entry is $ Government grants should be credited directly to equity Select one: O True False Which of the following statements correctly describe GAAP? Select one: O a. GAAP is a common set of accounting principles, standards and procedures. O b. GAAP aims to improve the clarity, consistency and comparability of financial information communication. O C. GAAP assists governing the wording of accounting according general rules and guidelines. O d. All the above An intangible asset is measured by a company at fair value. The asset was revalued by $1,000 in 2018, and there is a revaluation surplus of $ 1,000 in the statement of financial position. At the end of 2019, the asset was valued again, and the downward valuation of $1,200 is required. Then, there should be a charge of $ 200 made as an in 2019. A machine cost $1,000 and has a carrying amount of $900. For tax purposes, depreciation of 200 has already been deducted in the current and prior periods and the remaining cost will be deductible in future periods, either as depreciation or through a deduction on disposal. Revenue generated by using the machine is taxable, any gain on disposal of the machine will be taxable and any loss on disposal will be deductible for tax purposes. The temporary difference is $ Which of the following statements about corporate governance is correct? Select one: O a. Corporate governance is the system of rules, practices, and procedures by which a firm is directed and controlled. O b. Corporate governance essentially involves balancing different or even conflicting interests of a wide range of stakeholders. O C. Corporate governance includes every sphere of management practices, from action plans and internal controls, to performance measurement and corporate disclosure. O d. All the above. cash-generating is the smallest identifiable group of assets for which independent cash flows can be identified and measured