MC 1 Flashcards
(20 cards)
Which importance of notes to financial statements provide a clear and complete understanding of financial statensents
a. Highlight Risks & Uncertainties
b. Improve Decision-Making
c. Ensure Regulatory Compliance
d. Enhance Transparency
d. Enhance Transparency
Which type of notes to financial statements disclose the accounting principles and methods used in preparing inancial statements?
a. Depreciation & Amortization Methods
b. Tax Liabilities & Deferred Taxes
c. Accounting Policies
d. Contingent Liabilities & Commitments
c. Accounting Policies
Which type of notes to financial statements has an example: “Other income include interest income from banks, P2.000 Income from sale of scraps, P1.000; miscellaneous income. P500.”?
a. Breakdown of Financial Statement Items
b. Accounting Policies
c. Financial Risk Management
d. Segment Reporting
a. Breakdown of Financial Statement Items
A company owns P550,000 in total assets and has P250,000 in total owner’s equity, based on the following data, the total liabilities of the company is:
a. P500,000
b. P400,000
c. P200,000
d. P300,000
d. P300,000
Which type of notes to financial statements discloses risks related to foreign exchange, credit, liquidity, and market fluctuations?
a. Contingent Liabilities & Commitments
c. Breakdown of Financial Statement Items
b. Accounting Policies
d. Financial Risk Management
d. Financial Risk Management
This key component of Balance Sheet are economic resources owned by the company:
a. Owner’s Equity
b. Assets
c. Stockholder’s equity
d. Liabilities
b. Assets
Which type of notes to financial statements has an example “The company contributes 5% of each employee’s salary to defined contribution pension plan. The total pension expense for the year was 1 million
a. Financial Risk Management
b. Related Party Transactions
c. Pension Plans & Employee Benefits
d Accounting Policies
c. Pension Plans & Employee Benefits
A business generates P200,000 from operations, raises P50,000 from bonds, and spends P150.000 on new vehicle, based on the following data, the net cash inflow of the business is:
a. 200,000
b. 100,000
c. 400,000
d. P300,000
b. 100,000
Which type of financial statements helps assess a company’s profitability?
a. Statement of Changes in Equity
b. Balance Sheet
c. Cash Flow Statement
d. Income Statement
d. Income Statement
This key component of Income Statement are direct costs related to producing goods/services:
a. Cost of Goods Sold
b. Operating Expenses
c. Retained Earnings
d. Gross Profit
a. Cost of Goods Sold
Which type of notes to financial statements discloses transactions with subsidiaries, parent companies, or key management personnel?
a. Related Party Transactions
b. Segment Reporting
c. Pension Plans & Employee Benefits
d. Breakdown of Financial Statement Items
a. Related Party Transactions
This key component of Cash Flow Statement are cash from buying/selling assets?
a. Financing Activities
b. Operating Activities
c. Investing Activities
d. Banking Activities
c. Investing Activities
A retail store spends P300,000 on product purchases, and incurs P250,000 in other expenses, leaving a net profit of P100,000, based on the following data, the revenue of the retail store is:
a.P650,000
b. P750,000
c. P550,000
d. P450,000
a.P650,000
Which importance of financial statements enables management to set financial goals and monitor progress?
a. Provides Financial Transparency
b. Helps in Business Planning
c. Aids Investment & Lending Decisions
d. Ensures Regulatory Compliance
b. Helps in Business Planning
The following are the key components of Statement of Changes in Equity except?
a. Retained earnings
b. Adjustments for losses or revaluation of assets
c. Dividends received
d. Share capital issued
c. Dividends received
Which type of financial statements lists the company’s assets, liabilities, and equity?
a. Balance Sheet
b. Income Statement
c. Statement of Changes in Equity
d. Cash Flow Statement
a. Balance Sheet
Financial statements are used by various stakeholders, including the following except?
a. Creditors and lenders
b. Customers
c. Investors and shareholders
d. Management
b. Customers
Which key component of financial reporting provides additional insights beyond just numbers?
a. Management’s discussion and analysis
b. Financial statements
c. Audit report
d. Notes to financial statements
d. Notes to financial statements
Which type of notes to financial statements discloses significant events occurring after the financial year-end but before the financial statements are published?
a. Segment Reporting
b. Events after the Reporting Period
c. Financial Risk Management
d. Related Party Transactions
b. Events after the Reporting Period
Which importance of financial reporting enables comparisons across time periods and with competitors?
a. Regulatory Compliance
b. Aids Decision-Making
c. Facilitates Performance Evaluation
d. Ensures Transparency
c. Facilitates Performance Evaluation
