Reference no: EM132972186

Problem 1: Which of the following best describes current IFRS in accounting for leases?

Select one:

a. Only long-term leases containing a BPO are capitalized..

b. Leases are not capitalized.

c. All leases are capitalized with few exceptions that relate to the short length of lease or immaterial amount.

d. Leases similar to instalment purchases are capitalized.

e. Only lease contracts for equipment and property are capitalized.

Problem 2: The cumulative feature of preferred shares

Select one:

a. limits the amount of cumulative dividends to the par value of the preferred shares.

b. requires that dividends not paid in any year must be made up in a later year before dividends are distributed to common shareholders.

c. means that the shareholder can accumulate preferred shares until they are equal to the stated value of common shares, at which time they can be converted into common shares.

d. enables a preferred shareholder to accumulate dividends until they equal the stated value of the shares and receive the shares in place of the cash dividends.

e. always accumulates dividends over the life of the shares and are paid on dissolution of the company.