Day 8

Question 1

If there is no principal market for a stock what is fair value?

Answer 1

The market with the most advantageous market - aka lowest price

MCQ-06057

Question 2

Fair value includes _____ costs but not _____ costs

Answer 2

Transportation costs but not transaction costs

MCQ-05407

Question 3

When valuing financial instruments, the company elected the fair value measurement option must apply accounting measurement based on what criteria?

Answer 3

Instrument by instrument basis

MCQ-08733

Question 4

When the recoverability of a bldg’s carrying amount is determined to be impaired, the buildings fair value is best measured as the:

Answer 4

Price that would be received for this type of building based on observable inputs in it’s principal market

MCQ-15870

Question 5

Define: Principal Market

Answer 5

Is the market with the greatest volume of activity for the asset for which fair value is determined

MCQ-04904

Question 6

Fair Value Hierarchy of Inputs:

Answer 6

1. Level 1 Inputs - Active markets for Identical assets or liabilities
2. Level 2 Inputs - Quoted prices for Similar assets or liabilities in Active markets / Identical or Similar assets in Non-Active Markets
3. Level 3 Inputs - Unobservable Future Cash Flows and Discount Rate / Based on the best available information

MCQ-06058

Question 7

Reportable Segments: Revenue Test

Answer 7

Minimum Business Segment reporting is 10% of revenue
&
Minimum Business Segment reporting is 10% of Assets
&
1. Combined reported loss of all Segments that reported a loss
is 10%
OR
2. Combined reported profit of all Segments that reported a
profit is 10%

MCQ-00127
MCQ-05055

Question 8

What must be considered in determining if an industry segment is a reportable segment?

Answer 8

1. Sales to unaffiliated customers
2. Intersegment sales

MCQ-05447

Question 9

Rule: To be significant enough to report on, a segment must be at least 10% of:

Answer 9

1. Combined revenues (whether intersegment or affiliated customers) OR
2. Operating Profit (of all segments not having an operating loss) OR
3. Identifiable Assets

MCQ-00249

Question 10

Rule: Operating profit is based on the measure of profit reported to the ________

Answer 10

“Chief Operating Decision Maker”

MCQ-00248

Question 11

What is required enterprise-wide disclosure regarding external customers?

Answer 11

The fact that transactions with a particular external customer constitute more than 10% of the total enterprise revenues

MCQ-04666

Question 12

Fair Value Hierarchy of Inputs:

Answer 12

1. Quoted prices in Active Markets for Identical
2. Inputs other than quoted market prices that are Directly** or **Indirectly Observable*
3. Unobservable inputs (Future Cash Flows and Discounts)

Flashcards

Question 13

Two quantitative thresholds used for Reportable Operating Segments

Answer 13

1. 10% “Size” Test
2. 75% “Reporting Sufficiency” Test

Flashcards

Question 14

What is the 75% “Reporting Sufficiency” Test

Answer 14

Combined external (consolidated) revenue of all reportable segments must be at least 75% of the total consolidated revenue of the entity

Flashcards