Online Access Free T7 Practice Test

When an employee has provided service in exchange for benefits to be paid in the future, what is it considered in accounting terms?

• A.A liability
• B.A long term benefit
• C.The employee value proposition
• D.A noncurrent expense

When a company provides information that is of sufficient importance to influence the judgment and decisions of an informed user, which principle of Level 3 of the conceptual framework is being represented?

• A.Full disclosure
• B.Going concern
• C.Measurement
• D.Faithful representation

The International Accounting Standards Board (IASB) has given companies the option to use fair value as the basis for measurement of financial assets and liabilities. Which of the following best defines fair value?

• A.A residual interest in the assets of the entity after deducting all its liabilities
• B.Amount for which an asset could be exchanged or a liability settled between knowledgeable, willing parties in an arm's length transaction
• C.Quality of information that confirms users' earlier expectations
• D.Faithful representation of the amount paid for a given item

Which of the following is the term that describes total net sales minus total expenses?

• A.Operating expenses
• B.Net income
• C.Total income
• D.Current assets

What is the main objective of IAS 19?

• A.To draw a distinction between long and short term benefits
• B.To prescribe the timing of payments
• C.To prescribe the accounting and disclosure for employee benefits
• D.To draw a distinction between a defined contribution and defined benefit plan