QQ Not yets

Question 1

A company is planning to sell a parcel of land that has been divided into several smaller lots. In order to determine the fair value of the land, which of the following unit of account assumptions should be considered?

Answer 1

Valuing each individual lot separately

The unit of account assumption refers to how an asset should be grouped or disaggregated for valuation purposes. In this scenario, the company is selling a parcel of land divided into smaller lots, so the appropriate unit of account would be valuing each individual lot separately.

Question 2

In governmental fund financial statements, how are capital assets typically reported?

Answer 2

Not reported in the fund financial statements

Question 3

How to calculate net cash flow after taxes?

Answer 3

Earnings before taxes
Subtract tax expense
Add back depreciation expense

Question 4

Which of the following best describes the role of the COSO ERM framework in managing environmental, social, and governance (ESG) related risks?

Answer 4

The framework provides a systematic approach to identifying, responding to, and reporting ESG risks

Question 5

What is the primary objective of benchmarking?

Answer 5

To identify best practices

Question 6

What is the formula for the debt service coverage ratio?

Answer 6

Operating income/total debt service
debt service is principal and interest payments

Question 7

What disclosure related to pension plan contributions is typically included in the notes to the financial statements of a defined benefit pension plan?

Answer 7

The contributions made by the employer and employees separately.

Question 8

Which of the following non-GAAP measures represents a company’s profit from core business operations, excluding non-operating income and non-recurring items?

Answer 8

Operating earnings

Question 9

What does the requirement for a derivative to be “net settled” imply?

Answer 9

The derivative must be settled in cash or another financial asset

Question 10

estimating growth rates for individual products or business segments and aggregating these estimates to determine the company’s overall revenue growth

Answer 10

bottom-up approach

Question 11

most suitable for companies that produce a large number of unique, custom products, as it assigns costs to individual jobs or projects based on the specific costs incurred for each job.

Answer 11

job order costing

Question 12

Under IFRS, how are segment liabilities treated in segment reporting?

Answer 12

Reporting segment liabilities is optional and at the discretion of management.

Question 13

What is the treatment of the ineffective portion of gains and losses in a hedging relationship?

Answer 13

Recognized in the income statement.

Question 14

to guarantee a minimum and maximum exchange rate for a future transaction

Answer 14

purpose of a currency collar

Question 15

reflect the perspective of hypothetical buyers and sellers in the market.

Answer 15

market participant assumptions

Question 16

is a measure of a company’s operating performance that excludes the effects of financing (interest) and tax. It helps assess a company’s ability to generate income from its operations, independent of its capital structure and tax situation.

Answer 16

EBIT (Earnings Before Interest and Taxes)

Question 17

________ __________including those between an Enterprise Fund and a General Fund, are eliminated in the preparation of government-wide financial statements because they represent internal movements of resources and do not affect the overall net position of the government.

Answer 17

interfund transfer

Question 18

a key metric used in cost-benefit analysis to compare the relative value of different project alternatives by taking into account the time value of money.

Answer 18

Net present Value

Question 19

a non-GAAP measure that helps assess the value generated from an entity’s customer base by calculating the average amount of revenue generated per user over a specific period.

Answer 19

Average revenue per user (ARPU)

Question 20

What are the eight components of the COSO ERM framework?

Answer 20

Internal Environment
Objective Setting
Event Identification
Risk Assessment
Risk Response
Control Activities
Information and Communication
Monitoring

Question 21

tokenization, stemming, and stop-word removal, are used to convert unstructured text data into a structured format.

Answer 21

natural language processing (NLP)

Question 22

Agency funds typically exhibit a _______ net position because they reflect custodial activities (assets equal liabilities). The agency fund collects and disburses funds on behalf of others, and any balance is owed to other entities.

Answer 22

zero

Question 23

measures the increase in a company’s sales, excluding the impact of acquisitions, divestitures, and currency fluctuations. This metric helps assess a company’s ability to grow its core business operations.

Answer 23

organic revenue growth

Question 24

a natural language processing technique used to convert unstructured text data into a structured format. It is not used for filling in missing values.

Answer 24

tokenization

Question 25

focuses on providing an analysis of the company’s liquidity, capital resources, and results of operations. It gives management an opportunity to discuss the financial statements, significant trends, and risks that the company faces.

Answer 25

Management discussion and analysis section required by Regulation S-K

Question 26

they are used to account for assets held by the government in a trust or agency capacity for others. The focus is on accountability and stewardship rather than profitability.

Answer 26

fiduciary funds

Question 27

an alternative to traditional earnings per share (EPS), which adjusts net income by adding back non-cash expenses like depreciation and amortization. This measure provides a view of a company’s earnings based on its cash-generating ability, rather than its accounting income.

Answer 27

Cash EPS

Question 28

What does the ‘expected term’ of an option in a share-based payment refer to?

Answer 28

The period from the grant date to the exercise date

Question 29

An ___________ derivative differs from a ___________ derivative in that it is part of another contract and cannot be traded separately

Answer 29

embedded
freestanding

Question 30

used to accelerate the flow of cash to a firm’s principal bank by having customers remit payment and company units make deposits to banks close to their locations.

Answer 30

concentration banking

Question 31

According to U.S. GAAP, which of the following criteria must be met for an operating segment to be considered reportable?

Answer 31

The operating segment’s revenue must be at least 10% of the combined revenue of all operating segments.

Question 32

What is the cost of retained earnings?

Answer 32

The opportunity cost of reinvesting earnings in the business instead of paying them out as dividends

Question 33

What is the journal entry when a gov’t allocated an amount for a future expense?

Answer 33

DR: Encumbrance
CR: Encumbrances Outstanding

Question 34

Depreciation on capital assets used in general government activities should be allocated to the __________ ________ that use those assets in the Statement of Activities.

Answer 34

specific programs

Question 35

Where are deferred outflows and deferred inflows reported for a government’s financial statements

Answer 35

Deferred Outlfows: separate component of assets in the statement of net position
Deferred Inflows: seperate component of liabilities
Deferred outflows: prepaid expenses
Deferred Inflows: unearned revenue

Question 36

What type of information is typically included in the RSI section related to pension and other post-employment benefits?

Answer 36

Details about the funding and actuarial assumptions of the plans.

Question 37

When a local government receives unrestricted state aid, how should it be reported in the Statement of Activities?

Answer 37

As general revenues

Question 38

When a component unit is _________ ________ on the primary government, it is often reported using the blended method.

Answer 38

fiscally dependent

Question 39

What is the formula for asset turnover ratio?

Answer 39

Sales/Average Total Assets

Question 40

sets forth the form and content requirements for financial statements that are to be filed with the Securities and Exchange Commission (SEC) by public companies. It includes specifics on the presentation of balance sheets, income statements, and other financial statements.

Answer 40

Regulation S-X

Question 41

How is the information about plan members’ accounts typically presented in a defined contribution pension plan’s financial statements?

Answer 41

As a combined total of all members’ account balances

Question 42

An entity that is structured such that the equity investors do not have the characteristics of a controlling financial interest.

Answer 42

variable interest entity

Question 43

What is the ‘grant date’ in the context of share-based payment arrangements?

Answer 43

The date when the employee accepts the stock option agreement

Question 44

Which section of Regulation S-K would a public company refer to for guidance on disclosing executive compensation?

Answer 44

Item 402

Question 45

What is the formula for the cash ratio?

Answer 45

What is the formula for the cash ratio?