20B Wrong Answers

Question 0

Planned volume variance that is expected to be absorbed by the end of the fiscal year should be…

Answer 0

Deferred on interim reporting dates whether favorable or unfavorable

Question 1

How do you calculate a third quarter income tax provision (expense) in an interim statement, when tax rates were 30% in the 1st and 2nd quarter and 35% in the 3rd quarter?

Answer 1

(Total income from all 3 quarters x 35%)

- (income from 1st + 2nd quarters x30%)

Question 2

Inventory losses from market declines should not be…

Answer 2

Deferred beyond the interim period in which the loss occurs

Question 3

If the market decline (in inventory) for interim reporting is considered to be temporary and will be recovered by year end…

Answer 3

No loss needs to be recognized

Question 4

In the fourth quarter when a loss on inventory has not recovered, the loss is considered…

Answer 4

Permanent and should be recognized

Question 5

The inventory loss is not recorded in…

Answer 5

The period of temporary decline, only in the period when the loss is
Considered permanent

Question 6

A decline in inventory market price expected to be other than temporary should be…

2) a subsequent recovery in market value should be….

Answer 6

Recognized in period of decline

2) recognized as cost recovery in period of increase, but never
Above original cost