Intermediate Accounting Volume 1, 7th Edition By Spiceland-Test Bank

Test Bank For Intermediate Accounting Volume 1, 7th Edition By Spiceland

ISBN-10:0077647092 , ISBN-13:978-0077647094

Chapter 1

1. The main purpose of financial accounting is to communicate useful financial information to decision-makers both inside and outside of the business organization.

True    False

2. The Canadian Business Corporations Act mandates that all incorporated companies in Canada follow IFRS.

True    False

3. Private companies in Canada may choose between IFRS or ASPE.

True    False

4. Canada has adapted its own pre-existing standards for public companies to IFRS, while the U.S has adopted IFRS completely.

True    False

5. A disclosed basis of accounting is acceptable if a company’s financial statements are prepared solely for internal use.

True    False

6. Only publicly traded companies in Canada are required to adopt IFRS.

True    False

7. Earnings quality is said to be high when most of a company’s earnings are the result of its continuing operations.

True    False

8. Income tax deferral is illegal in Canada.

True    False

9. In Canada, income for tax and accounting purposes may be different.

True    False

10. External users of a company’s financial statements may have conflicting objectives.

True    False

11. In Canada, IFRS standards were essentially converged with Canadian GAAP.

True    False

12. A company’s functional currency is always the currency in which the financial statements are presented.

True    False

13. It is acceptable for publicly traded Canadian companies to report under US GAAP.

True    False

14. In Canada, almost all equity financing for both public and private companies is done through private placements.

True    False

15. IFRS standards may be modified to allow for a disclosed basis of accounting (DBA).

True    False

16. Privately held, publicly accountable companies with a fiduciary responsibility must comply with IFRS.

True    False

17. Mutual fund companies, which may be privately held, are deemed to have a fiduciary responsibility and must therefore comply with IFRS.

True    False

18. Canadian companies must always present their financial results in Canadian dollars.

True    False

19. Canadian corporations are prohibited from using U.S. GAAP.

True    False

20. A company’s functional currency is the currency in which it conducts most of its business.

True    False

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