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Statement 1: Consolidated operating expenses will not be affected, in any capacity,
by an intercompany sale of
land.
Statement 2: Consolidated operating expenses will not be affected, in any capacity, by an intercompany sale of
merchandise
A.Only statement 1 is true
B.Both True
C.Only statement 2 is true
D.Both False
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Solved in 2 steps
- Statement 1: Consolidated operating expenses will not be affected, in anycapacity, by an intercompany sale ofland.Statement 2: Consolidated operating expenses will not be affected, in anycapacity, by an intercompany sale ofmerchandise a.Only statement 2 is trueb.Both Falsec.Both Trued.Only statement 1 is trueStatement 1: Consolidated operating expenses will not be affected, in any capacity, by an intercompany sale of land. Statement 2: Consolidated operating expenses will not be affected, in any capacity, by an intercompany sale of merchandise Choices A. Both is true B. Both is false C. Only statement 1 is true D. Only statement 2 is trueTrue or False According to PFRS 15, if an entity expects that a portion of giftcertificates sold will not be redeemed, the entity recognizes theexpected breakage amount as revenue in proportion to the pattern of rights exercised by customer
- The historical cost principle provides that: Select one: O a. the recorded amount of an acquired item should be the fair market value of the item. b. None of the answers are correct O c. tems whose costs are insignificant compared to other amounts on the financial statements may be accounted for in the most expedient manner. O d. assets and equities be expressed in terms of a common denominator. O e. the expenses of generating revenue should be recognized in the same period that the related revenue is recognized.According to PFRS 5, Assets held for sale are measured at a. fair value b. fair value less cost to sell c. carrying amount d. lower of b and cQuestion 3. Classify each of the following accounts as (a) asset, (b) liability, or (c) equity. a.→Defined benefit obligation b.→Plan asset c.→Right-of-use asset d.→Contract asset e.→ Unearned revenue f.→ Deferred tax asset g.→Accumulated other comprehensive losse
- All financial assets are initially measured at fair value plus transaction costs, except A. Amortized cost C.None of these C. Fair value through profit and loss D. Fair value through OCI1.If Company Abee holds consigned goods from Company XyXy, which statement is true? Group of answer choices Neither company will report the consigned inventory as their asset. Both companies will report the consigned inventory as their asset. Company XyXy will report the consigned inventory as their asset. Company Abee will report the consigned inventory as their asset. 2. Inventory that is in transit between the supplier and purchaser should: Group of answer choices not be included in either party's inventory balance. be recorded as inventory by whichever party has paid for the transportation costs as dictated by the FOB terms. be included in the supplier's inventory balance always. be included in the purchaser's inventory balance always. 3. If costs are rising, which inventory costing method will result in the highest ending inventory balance for the period? Group of answer choices Specific identification LIFO FIFO Weighted average 4. If costs are rising, which…3. Statement 1: All allocated excess/purchase differentials are amortized.Statement 2: The worksheet eliminations prepared subsequent to acquisition remove the allocated excess/purchase differential amortizations from the consolidated financial statements. a. Only statement 1 is trueb. Only statement 2 is truec Both statements are trued. Both statements are false
- Which of the following items may be classified as nonoperating revenues and expenses? Multiple Choice Loss on the sale of equipment. Interest revenue. All of the other answers are classified as nonoperating revenues and expenses. Interest expense.Account for all the prospective losses but leave aside all the prospective profits. This is as per a. Materiality convention b. Timeliness convention c. Conservatism convention d. Prospective conventionStatement 1: It is not always necessary to identify both fair value less cost to sell and value in use. Only when fair value less cost to sell is not greater than the carrying amount, then value in use calculation is required. Statement 2: IAS 36 is not applicable to financial assets, particularly those that are classified as investments in subsidiaries, joint ventures and associates. Only Statement 1 is correct. Only Statement 2 is correct. Both statements are correct. Both statements are incorrect.