Prior period errors are omissions from and misstatements in the financial statements for one or more periods arising from a failure or misuse of reliable information that I. Was not available when financial statements for those periods were authorized for issue. II. Could reasonably be expected to have been obtained and taken into account in the preparation and presentation of those financial statements. a. I only. b. Пonly. c. Both I and II. d. Neither I nor II.

Prior period errors are omissions from and misstatements in the financial statements for one or more periods arising from a failure or misuse of reliable information that I. Was not available when financial statements for those periods were authorized for issue. II. Could reasonably be expected to have been obtained and taken into account in the preparation and presentation of those financial statements. a. I only. b. Пonly. c. Both I and II. d. Neither I nor II.

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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In considering materiality for planning purposes, an auditor belives that misstatements aggregate P100,000 would have a metrial effect on an entity's income statement, but that miststatement would have to aggregate P200,000 to materially effect the balance sheer. Ordinarilu, it would be appropriate to design procedures that would be expected to detect misstatements that aggregate. A. P100,000 B. P200,000 C. 150,000 D. P300,000
If the statement of financial position error is discovered in a subsequent accounting period, what action is to be done by the entity? A. Reclassify the item to its proper real account but do not restate the statement of financial position of the prior year affected by the error. B. Reclassify the item to its proper real account. C. Restate the statement of financial position of the prior year affected by the error. D. Reclassify the item to its proper real account and restate the statement of financial position of the prior year affected by the error
Adverse Basis for mod paragraph Cpa firm Disclaimer of opinion Expressing opinion Management I modified Unqualified Update
What is the objective in testing for cut-off? Select one: O a. That no transactions of the current period have been delayed and recorded in a fu O b. Whether transactions are recorded in the proper period ○ c. That no transactions from the prior period are included in the current period's bala O d. Whether all of the current period's transactions are recorded
H received an indorsement from C. The indorsement was located at the back of the check. Upon inspection, H noticed that the check does not have a date. What is the effect to the negotiable instrument? A. The negotiable instrument is invalidated because the date signifies the maturity of the instrument B. The negotiable instrument is lacking a very important detail particularly the seal of the indorser C. The missing date does not affect the negotiability of instrument D. It is not the date which is important. It is the acceptance of the drawer for the indorsement made by C.
describe the fi nancial reporting treatment and analysis of non-recurring items (including discontinued operations, extraordinary items, unusual or infrequent items) and changes in accounting standards
5
According to IAS 8, how should prior period errors that are discovered in a subsequent reporting period be recognized in the financial statements? a. As an adjustment to beginning retained earnings for the reporting period in which the error was discovered. b. As a note in the financial statements that the error was previously made but has since been corrected. c. In the statement of comprehensive income. d. Retroactively for all periods presented.
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