Changing the method of accounting for depreciation will result in a. prospective

Question

Changing the method of accounting for depreciation will result in a. prospective approach b. a note disclosure c. a cumulative change in accounting principle d. a prior period adjustment to retained earnings Under IFRS, impairment losses may be reversed in subsequent year for: a. Intangible assets with finite lives b. Physical assets c. Goodwill d. a and b only e. all of the above During ABC Co.s inventory increased by $4500 and accounts payable decreased by $8700. If cost of goods sold was $325,000 then cash paid to suppliers of merchandise is a. $338,500 b. 325,000 c. 329,000 d. 338,200 e. 325,000 Which type of expenditure may be capitalized as an intangible asset for IFRS, but expensed under US GAAP a. Internally developed goodwill b. Goodwill arising from a purchase of another entity c. Internally developed customer list d. Internal development cost for a patented process e. Software development costs Callable bonds a. Can be redeemed by the issuer at some time at a pre-specified price b. Can be converted to stock c. Mature in a series of payments d. Can be redeemed at the holders choice e. Are issued by the government If a bond is issued at a premium, overtime, the amortization of the premium will: a. Increase b. Decrease c. Not change d. Cannot be determined without knowing the interest rate If an entity neglected to amortize the premium on outstanding ten-year bonds payable, what is the effect of this omission on interest expense and the bond-carrying amount (book value) respectively? a. Understate; understate b. Understate; overstate c. Overstate; understate d. Overstate; Overstate A debit balance in the account Market Adjustment- Trading Securities at the end of the year should be interpreted as a. The net realized holding gain to date b. The net unrealized holding gain to date c. The net realized holding gain for that year d. The net unrealized holding gain for that year Dividends in arrears are: a. Disclosed in the notes only b. Recognized as current liabilities c. Recognized as long-term liabilities d. Recognized as contra equity Par Value Treasury Stock is resold for an amount in excess of its purchase prize. This will result in a. An increase in contributed capital b. An increase in retained earnings c. A decrease in total shareholders’ equity d. A decrease in retained earnings e. An increase in common stock These are question I got wrong on a quiz. If you could give an explanation for each answer that would help me a lot in my studies. Thanks again!

Explanation / Answer

Solution.

Changing the method of accounting for depreciation will result in.

b. a note disclosure

A change in the method of depreciation is treated as a change in an accounting estimates and is disclosed accordingly.

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