81. At which rate should noncurrent assets be translated when the functional currency figures are being translated into a different presentation currency? a. The average rate. b. The closing rate. c. The historical exchange rate. d. The spot exchange rate. 82. Members' shares in cooperatives shall be classified as equity when a. The redemption of member's share is unconditionally prohibited by law. b. The entity has the unconditional right to refuse redemption of member's shares. c. Either the entity has the unconditional right to refuse redemption of member's shares or the redemption of member's shares is unconditionally prohibited by law. d. None of these. 83. If an entity uses a modified cash basis of accounting, the modifications from the pure cash basis should have substantial support which requires that a. No modifications are allowed. b. The modifications must be the same as GAAP and not illogical. c. The modifications must be the same as those required by tax law. d. The financial statements have only minor modifications from GAAP. Wiley 12

84. At the middle of the current year, an entity granted employees compensatory share options. How should the entity account for the outstanding options in calculating earnings per share for the current year if the options are not anti-dilutive?

a. Include the options in the denominator of basic and diluted earnings per share for the entire year. b. Include the options in the denominator of diluted earnings per share weighted by the number of months outstanding. c. Ignore the options in the calculation of diluted earnings per share. d. Include the options in the denominator of diluted earnings per share for the entire year. 85. Under PAS 33, contingent ordinary shares are treated as outstanding and included in the computation if the condition is satisfied for a. both basis and diluted EPS from date of agreement b. both basic and diluted EPS from the beginning of the year c. both basic and diluted EPS from the date the condition is satisfied d. basic EPS from the date the condition is satisfied and for diluted EPS from beginning of year or date of agreement, if later

86. Continuation of an accounting entity in the absence of evidence to the contrary is an example of the basic concept of a. Accounting entity. c. Going concern. b. Consistency. d. Substance over form. 87. Note disclosures for long-term debt generally include all of the following, except. a. Assets pledged as security b. Names of specific creditors. c. Restrictions imposed by the creditors d. Call provisions and conversion privileges. 88. All of the following would result in a deferred tax asset, except a. the tax base of an asset is greater than carrying amount b. interest expense is accrued but included in taxable income on a cash basis c. the financial accumulated depreciated is greater than tax accumulated depreciation d. development costs have been capitalized and amortized but were included in determining taxable income in the period incurred 89. The statement of financial position may include unrealized gains and losses from which type of investment securities a. Trading securities only c. Held-to-maturity securities only b. Available-for-sale securities only d. Trading and Available-for-sale securities

90. A company using a periodic inventory system neglected to record a purchase of merchandise on account at year-end. This merchandise was omitted from the year-end physical count. How will these errors affect assets, liabilities, and stockholder's equity at the end of the year and net earnings for the year?

Assets Liabilities Stockholder's equity Net earnings a. No affect Understated Overstated Overstated b. No affect Overstated Understated Understated c. Understated Understated No affect No affect d. Understated No affect Understated Understated 91. Under Statement of Financial Accounting Concept No. 2, which of the following interacts with both relevance and reliability to contribute to the usefulness of information? (m.c.) a. Comparability b. Timeliness c. Neutrality d. Predictive value 92. What is the principal accounting for a compound instrument? a. The issuer shall classify a compound instrument as a liability in its entirely. b. The issuer shall classify a compound instrument as either a liability or equity. c. The issuer shall classify a compound instrument separately as liability component. d. The issuer shall classify the liability and equity components of a compound instrument separately as liability or equity instrument 93. Which of the following statements is true regarding the term of office of PRC CPE Council for Accountancy a. The term of office of the Chair is co-terminus with his incumbency in the PRC. b. The term of office of the first member is co-terminus with his incumbency as officer of PICPA. c. The term of office of the second member is co-terminus with his incumbency as officer of the organization of deans or department heads. d. All of the statements are true. 94. An entity has decided to improve its defined benefit pension scheme. The benefit payable will be determined by regerence to 60 years of service rather than 80 years of service. As a result, there is an increase in the defined benefit pension liability. How should the increase in the pension liability be treated in the financial statements? a. The past service cost should not be recognized. b. The past service cost should be charged against retained earnings. c. The past service cost should be charged against profit or loss for the year. d. The past service cost should be allocated over the remaining service period. 95. Under PAS 32, which of the following would not be classified as a financial liability? a. A preference share that will be redeemed by the issuer for cash on a future date. b. A contract for the delivery of as many of the entity's ordinary shares as are equal in value to a fixed amount on a future date. c. A written call option that gives the holder the right to purchase a fixed number of the entity's ordinary shares in return to a fixed price. d. An issued perpetual debt instrument. 96. The following relate to revaluation of plant assets and quasi-reorganization. Which statement is false?

a. The difference between historical cost net book value and sound value is credited to Revaluation Surplus b. Under Philippine GAAP, quasi-reorganization, can be effected through revaluation of assets c. After a quasi-reorganization, the balance of Retained Earnings will increase d. Any remaining balance of revaluation surplus (or appraisal capital) in the ledge after wiping out a deficit may be used to wipe out losses that may be incurred in the future 97. Under PFRS 13, the fair value of an asset or liability is measured as a. the appraised value of the lease or liability b. the cost of the asset less accumulated depreciation or the carrying amount of the liability on the date of sale. c. the price that would be paid to acquire the asset or received to assume the liability in an orderly transaction between market participants d. the price that would be received when selling an asset or paid when transferring liability in an orderly transaction between market participants. 98. According to Statement of Financial Accounting Concepts No. 2, relevance and reliability are the two primary qualities that make accounting information useful for decision making. Predictive value is an ingredient of Relevance Reliability a. No No b. No Yes c. Yes Yes d. Yes No 99. On May 1, 19-0, a company purchased a new machine which it does not have to pay for until May 1, 19-2. The total payment on May 1, 19-2 will include both principal and interest. Assuming interest at a 10% rate, the cost of the machine would be the total payment ,ultiplied by what time value of money concept? (m.c.) . a. Future amount of annuity of 1 c. Present value of annuity of 1 b. Future amount of 1 d. Present value of 1 100. The par value of an ordinary share represents a. The liquidation value of the share. b. The book value of the share. c. The legal nominal value assigned to the share. d. The amount received by the corporation when the share is originally issued.