5. S1: For the results of a component of an entity to be classified as discontinued operation, management must have entered in a sale agreement.S2: The net income or net loss from discontinued operation, net of tax shall be shown as a single amount in the income statement after income from continuing operations and before net income. * A. Both statements are true B. Both statements are false C. Only statement 1 is true D. Only statement 2 is true 6. The fuel and oil as a major line of business of San Miguel Enterprises becomes available for immediate sale in its present condition. The termination costs of employees resulting from the discontinuance should be * A. Included in the computation of other comprehensive income B. Shown as other expense O c. Shown as a prior period adjustment D. Netted against the income from operations of the component as part of discontinued operation E. None of them

5. S1: For the results of a component of an entity to be classified as discontinued operation, management must have entered in a sale agreement.S2: The net income or net loss from discontinued operation, net of tax shall be shown as a single amount in the income statement after income from continuing operations and before net income. * A. Both statements are true B. Both statements are false C. Only statement 1 is true D. Only statement 2 is true 6. The fuel and oil as a major line of business of San Miguel Enterprises becomes available for immediate sale in its present condition. The termination costs of employees resulting from the discontinuance should be * A. Included in the computation of other comprehensive income B. Shown as other expense O c. Shown as a prior period adjustment D. Netted against the income from operations of the component as part of discontinued operation E. None of them

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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For each of the following cate ories, state con:Cisely a transaction that will have the required ef. fect on the elements of the acc ounting iquation.' EXERCISE 2.7 Effects of Business Transactions a. Increase an asset and inerease a liability. b. Decrease an asset and decrease a liabilitv. c. Increase one asset and decrease another asset. d. Increase an asset and increase owner's eyuit e. Increase one asset, decrease another asset, and increase a liability. LO 3
1(a) State with reason whether the following statements are true or false (i) Change in Method of Depreciation is regarded as change in Accounting Policy of the entity. (ii) Depreciation is non-cash and non- operating expense which is to be provided for whether there are profits/losses. (iii) Net Profit is reflected in higher cash balances and net loss is reflected in lower net worth. (iv) Contingent liability is an ascertained liability but its amount and due date are indeterminate. (v) Fundamental Assumptions are always required to be disclosed in the financial statements.
1. Directly attributable costs include:I. Interest Expense when the asset is ready for useII. Value-added taxes, the entity is not VAT-registered a. I onlyb. II onlyc. Both I and IId. Neither I nor II2. Computation of maximum dividend of wasting asset corporations include the following, except: I. Appropriated retained earningsII. Realized portion of accumulated depletiona. I onlyb. II onlyc. I and IId. None from I and IIPLEASE ADD REFERENCE FOR ANSWERPS: NOT SATISFIED WITH THE ANSWER OF LAST TUTOR
Which item is not included in an S corporation's nonseparately computed income? a. Net sales. b. Cost of goods sold. c. Dividends received. d. Depreciation recapture. e. All of these are included in non-separately computed income.
15 Under physical capital maintenance assumption, a profit is earned only if the physical operating capability of the entity at the end of the accounting period is _____________ its physical operating capability at the start of the period, after adjusting for any amounts contributed by or distributed to owners during the period. a. Equal to b. Less than c. None of the given options d. Greater than
Revenue Expenditures are Select one: O a. Short-life and must always be replaced to generate revenue for an accounting period O b. Reduces profit O c. All the above O d. Expenses are shown in Income Summary
Indicate if the following transaction from Torte Baking Company increases or decreases assets, liabilities, equity, revenue, expense, and net income. The pattern of the + and - must adhere to the balance sheet equation. Show the impact of revenue and expense on both net income and equity. If there is a + and - within one category (e.g., assets for transaction 2), then list the accounts that go up and down. Transaction (26) Recognize tax expense that will be paid later. Assets ["", "", ""] Liabilities ["", "", ""] Equity ["", "", ""] Revenue ["", "", ""] Expense ["", "", ""] Net Income ["", "", ""]
Which limitation of an income statement occurs when one company uses an accelerated depreciation method while another company uses straight-line depreciation? O Companies omit from the income statement items they cannot measure reliably. O Income measurement involves judgment. O Income numbers are affected by the accounting methods employed. All of these answer choices are correct.
We can say that the business is in profit, when: Select one: a. Income exceeds Liabilities b. Assets exceed Expenses c. Income exceeds Liabilities d. Income exceeds Expenses
The primary purpose of showing special types of eventsseparately in the income statement is to:a. Increase earnings per share.b. Assist users of the income statement in evaluating theprofitability of normal, ongoing operations. c. Minimize the income taxes paid on the results of ongo-ing operations. d. Prevent unusual losses from recurring.
3. The statement of profit or loss and other comprehensive income shall present allocation of profit or loss and other comprehensive income for the period attributable toa. Owners of the parentb. Non-controlling interests c. Both a and bd. Neither a nor b