1. As used in international accounting, a ?hedge? is: A) a business transaction made to reduce the exposure of foreign exchange risk. B) the legal barrier between the various divisions of a multinational company. C) the loss in US $ resulting from a decline in the value of the US $ relative to foreign currencies. D) one form of foreign direct investment. 2. A translation adjustment may be necessary when: A) notes to financial statements are converted from one language to another. B) foreign currency financial statements are converted to another currency. C) consolidated financial statements are prepared. D) hedging foreign currency. 3. What is ?transfer pricing?? A) The cost to convert from one country's GAAP to another country's GAAP B) The value of sales made in a foreign country C) The method of recording transactions between divisions within the same company D) The taxes paid on sales in a foreign country 4. The process by which a domestic company sells its stock, already sold on its domestic exchange, on a foreign stock exchange is known as: A) SEC registration B) Initial public offering C) Consolidation D) Cross-listing 5. What group is primarily responsible for the creation of International Financial Reporting Standards (IFRS)? A) Financial Accounting Standards Board (FASB) B) International Forum on Accountancy Development (IFAD) C) International Federation of Accountants (IFA) D) International Accounting Standards Board (IASB) 6. For a U.S. multinational corporation, consolidating the financial statements of foreign subsidiaries requires two steps. First, the foreign subsidiary's statements must be restated according to U.S. GAAP. The next step is to: A) convert the account balances into U.S. dollars. B) determine the exchange rate gain or loss. C) calculate the translation adjustment. D) restate the income using international accounting standards. 7. In countries such as the U. S., there is great demand for public disclosure of accounting information. What is the reason for this? A) Corporate management isn't trustworthy. B) Businesses rely heavily on financing through issuance of stock to the public. C) The American populace is better able to read financial statements than people in other countries. D) U.S. government officials are generally members of corporate boards of directors and can get all the information they require. 8. Which of the following statements is NOT universally included in annual reports worldwide? A) Balance Sheet B) Cash Flow Statement C) Income Statement D) All of the above statements are included in annual reports worldwide. 9. IFRS allows for which two methods for valuing property, plant and equipment? A) Historic cost and general purchasing power B) Historic cost and fair value C) Fair value and general purchasing power D) Fair value and inflation-adjusted 10. In the United States, conformity between financial statement presentation and tax treatment is required only for: A) goodwill. B) depreciation. C) gains or losses on securities. D) the use of the LIFO inventory cost flow assumption. 11. Assets are commonly shown in order of their liquidity, or in reverse order of their liquidity. What does ?liquidity? mean? A) Liquidity refers to how easily the assets are converted to cash. B) Liquidity means that assets are inflation-adjusted. C) Liquidity refers to whether the asset is depreciable or not. D) Liquidity means that the assets are closely matched to specific liabilities. 12. If a company chooses the revaluation model permitted in IAS 16 for fixed asset measurement: A) annual revaluations must be performed on each class of assets. B) it must update the valuation so that the balance sheet represents fair value on the balance sheet date. C) appraisals must be performed by an official of the IASB. D) the depreciated replacement cost must be used as the fair value of the fixed asset. 13. What is one major difference between IFRS and U.S. GAAP relative to correction of errors? A) U.S. GAAP is silent as to how to treat errors that have been discovered. B) IFRS is silent as to how to treat errors that have been discovered. C) Under U.S. GAAP a prospective approach is taken. D) Under IFRS, if it?s impractical to restate financial statements, then no restatement is necessary. 14. Under IAS 16 (Property, Plant, and Equipment), subsequent revaluation decreases are: A) never recognized. B) credited to a revaluation surplus account. C) recognized as an expense on the Income Statement. D) first recognized as a reduction in any related revaluation surplus.
Paper#13553 | Written in 18-Jul-2015Price : $25