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Confracs (T/F)

The document contains a series of true/false questions related to accounting concepts and standards. Some of the key topics covered include: the definition and purpose of a conceptual framework, qualitative characteristics of useful financial information, accounting for government grants, classification and measurement of investment property, accounting for bearer plants and agricultural produce, and models for subsequent measurement of property, plant and equipment.

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Zo Thelf
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42 views

Confracs (T/F)

The document contains a series of true/false questions related to accounting concepts and standards. Some of the key topics covered include: the definition and purpose of a conceptual framework, qualitative characteristics of useful financial information, accounting for government grants, classification and measurement of investment property, accounting for bearer plants and agricultural produce, and models for subsequent measurement of property, plant and equipment.

Uploaded by

Zo Thelf
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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CONFRACS (T/F)

1. The PRC is responsible for preparing and grading the Philippine CPA examination.
Ans: FALSE
2. In a vineyard, the grapevines are the bearer plant and the grapes are the agricultural
produce.
Ans: TRUE
3. The grant is presented in the income statement, either separately or under the general
heading “other income”.
Ans: TRUE
4. Grant in recognition of specific expenses shall be recognized as income over the period
of the related expense.
Ans: FALSE
5. Grant related to non-depreciable assets shall be recognized as income over the periods
and in proportion to the depreciation of the related asset.
Ans: FALSE
6. Trees grown to be harvested and sold as a log or lumber are bearer plants.
Ans: TRUE
7. Land held for a currently undetermined use is an investment property.
Ans: FALSE
8. Any internal profit or saving on construction is eliminated in arriving at the cost of a self-
constructed asset.
Ans: TRUE
9. Managerial accounting is the accumulation and preparation of financial reports for
internal users only.
Ans: TRUE
10. IAS 40 further provides that agricultural produce growing on bearer plant shall be
classified and presented as a biological asset.
Ans: FALSE
11. An exchange transaction has commercial substance when the cash flows of the asset
received differ significantly from the cash flows of the asset transferred.
Ans: TRUE
12. Property held for future use as owner-occupied property is an investment property,
Ans: TRUE
13. Property held for future development and subsequent use as owner-occupied property is
an investment property.
Ans: TRUE
14. Government grant shall be recognized on a cash basis as this is not consisted with
generally accepted accounting practice.
Ans: FALSE
15. Cash discount and rates are generally considered as reduction of cost and not as
income.
Ans: TRUE
16. The financial statements are prepared at least annually and are directed toward the
common needs of a wide range of users.
Ans: TRUE
17. When the entity uses the cost model, transfer between investment property, owner-
occupied property and inventory shall be made at carrying amount.
Ans: FALSE(FAIR VALUE)
18. Management services has no precise coverage
Ans: TRUE
19. Under such exceptional cases, PAS 40, paragraph 54, mandates that the entity shall
measure such investment property using fair value model until the disposal of the
investment property.
Ans: FALSE (PARAGRAPH 53)
20. Agricultural produce is the harvested product of the entity’s biological assets.
Ans: TRUE
21. The difference between the cash price and the total payments is recognized as interest
expense over the credit period.
Ans: TRUE
22. If an inventory is transferred to investment property that is to be carried at fair value, the
remeasurement to fair value shall be included in other comprehensive income.
Ans: FALSE (included in profit or loss dapat)
23. Such grant shall be recognized as income when the conditions attached to the
recognition have been satisfied
Ans: TRUE?
24. The fair value model means that property, plant and equipment are carried at cost less
any accumulated depreciation and any accumulated impairment loss.
Ans: TRUE?
25. Only land and building can qualify as investment property.
Ans: TRUE
26. It is required to disclose the name of the government agency that gave the grant along
with the date of sanction of the grant by such government agency and the date when
cash was received in case of monetary grant
Ans: FALSE
27. The rubber trees are recognized as biological asset because of the dual use
Ans: TRUE
28. The property, plant and equipment are tangible assets, meaning with physical
substance.
Ans: TRUE
29. Government assistance is action by government designed to provide an economic
benefit specific to an entity or range of entities qualifying under certain criteria
Ans: TRUE
30. Government assistance is action by government designed to provide an economic
benefit specific to an entity or range of entities qualifying under certain criteria
Ans: TRUE
31. Taxation has traditionally been the primary service offered by most public practitioners
Ans:TRUE?
32. Going concern assumption is also known as the continuity assumption
Ans:TRUE
33. Receipt of grant does not of itself provide conclusive evidence that the conditions
attaching to the grant have been or will be fulfilled
Ans: TRUE
34. PAS 16, paragraph 22, provides that the cost of abnormal amount of wasted material,
labor or overhead incurred in the production of self-constructed asset is included in the
cost of the asset
Ans: TRUE
35. The revaluation model means that property, plant and equipment are carried at revalued
amount, being the fair value at the date of revaluation less any subsequent accumulated
depreciation and subsequent accumulated impairment loss
Ans: FALSE (REVALUED CARRYING AMOUNT)
36. Land held for long-term capital appreciation is an investment property
Ans: TRUE
37. When various assets are acquired for a lump sum price, the total cost is allocated to the
individual assets based on their relative cost.
Ans: FALSE(SEVERAL YATA)
38. Government grant is sometimes called subsidy, subvention or premium.
Ans: TRUE
39. In case where there is a conflict, the requirements of the conceptual framework shall
prevail over the Philippine Financial Reporting Standard.
Ans: FALSE

1. The objective of financial reporting is the foundation of the conceptual framework.


Ans:TRUE
2. Supplementary information may include details or amounts that present a different
perspective from that adopted in the financial statements.
Ans:TRUE
3. Timeliness and neutrality are two ingredients of relevance.
Ans:FALSE
4. Relevance and faithful representation are the two fundamental qualities that make
accounting information useful for decision-making.
Ans:TRUE
5. A conceptual framework is a coherent system of concepts that flow from an objective.
Ans:TRUE
6. The historical cost principle would be of limited usefulness if not for the going concern
assumption.
Ans:TRUE
7. The idea of consistency does not mean that companies cannot switch from one
accounting method to another.
Ans:TRUE
8. Users of financial statements are assumed to need no knowledge of business and
financial accounting matters to understand information contained in financial statements.
Ans:FALSE
9. Decision usefulness is the underlying theme of the conceptual framework.
Ans:TRUE

1. R&D costs are not expensed in the period incurred.


Ans:FALSE
2. In an exchange of non-monetary assets, if the transaction lacks commercial substance,
any gain is deferred, but a loss is recognized immediately.
Ans:TRUE
3. Entities are encouraged and required to disclose fully depreciated property.
Ans:FALSE
4. Depreciation of an asset begins when bought.
Ans:FALSE
5. The residual value of an asset may increase to an amount equal to or greater than the
carrying amount.
Ans:TRUE
6. Depreciation methods include straight line, production method and diminishing balance
method.
Ans:TRUE
7. Straight line depreciation is a varying charge over the useful life of the asset.
Ans:FALSE
8. Accelerated depreciation is on the philosophy that new assets are generally capable of
producing more revenue in the later years.
Ans: FALSE
9. Subject to depreciation is one of the main characteristics of property, plant and
equipment.
Ans: FALSE
10. Cost model and fair value model are valuation models an entity uses to measure
property, plant and equipment.
Ans: FALSE

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