Online Access Free Financial-Accounting-and-Reporting Practice Test

The accounting policies used by companies must result in financial reports that are

• A.independently audited.
• B.signed by the CEO or equivalent.
• C.easy to read.
• D.comparable with previous years' reports.

Liquidity of a company is based on its ability to

• A.buy back shares.
• B.meet short term commitments.
• C.pay dividends to shareholders.
• D.meet long term commitments.

Which one of the following would be included in a statement of financial position?

• A.proceeds from long term borrowings
• B.finance costs
• C.cost of sales
• D.retained earnings

Which one of these is a disadvantage of a conceptual framework?

• A.A single framework is not suitable for all users of financial statements.
• B.It increases the chances of political interference in the development of accounting standards.
• C.It replaces the established principles.
• D.It mandates the formats of various financial statements.

In the context of a regulatory framework, a principles-based system

• A.removes any element of judgement by providing clear requirements.
• B.attempts to cover specific eventualities.
• C.provides a theoretical basis with broad terms of reference.
• D.is a rule-driven approach.