36. Mars, Inc. follows IFRS for its external financial reporting, while Jerome Company uses GAAP for its external financial reporting. During the year ended December 31, 2021. both companies changed from using the completed-contract method of revenue recognition for long-term construction contracts to the percentage-of-completion method. Both companies experienced an indirect effect, related to increased profit-sharing payments in 2021, of $30,000. As a result of this change, how much expense related to the profit-sharing payment must be recognized by each company on the income statement for the year ended December 31, 2021? Mars, Inc. Jerome Company a $30,000 $30,000 b. $30,000 c. S-O- S-O d. S-0- $30,000 $0 Chapter 23 a 37. Which of the following is false with regard to IFRS and the statement of cash flows? The IASB is strongly in favor of requiring use of the direct method for operating activities b. In certain circumstances under IFRS, bank overdrafts are considered part of cash and cash equivalents. IFRS requires that noncash investing and financing activities be excluded from the statement of cash flows. All of these statements are false with regard to IFRS and the statement of cash flows. C d 38. Ocean Company follows IFRS for its external financial reporting Which of the following methods of reporting are acceptable under IFRS for the items shown? Interest paid Dividends paid a Operating Investing b. Investing Financing c. Financing Investing d. Operating Financing 39. Ocean Company follows IFRS for its external financial reporting. Which of the following methods of reporting are acceptable under IFRS for the items shown? Interest received Dividends received a Operating Investing b. Investing Financing C. Financing Investing d Operating Financing 40. Wave, Inc. follows IFRS for its external financial reporting. The statement of cash flows reports changes in cash and cash equivalents. Which of the following is not considered cash or a cash equivalent under IFRS? a. Coin b. Bank overdrafts. c. Commercial paper Accounts receivable d