Reference no: EM132971407

Problem 1: How should import duties be dealt with when valuing inventories at the lower of cost and net realizable value?

a) Added to cost

b) Ignored

c) Deducted in arriving at NRV

d) Deducted from cost

Problem 2: All of the following are characteristics of financial assets classified as loan and receivables, except:

a) They are not quoted in an active market.

b) They have fixed or determinable payments.

c) The holder has demonstrated positive intention and ability to hold them to maturity.

d) The holder can recover substantially all of its investment (unless there has been credit deterioration).

Problem 3: In the case of long-term installments receivable as in real estate installment sales where a major portion is collected beyond the normal operating cycle:

a) The entire receivables are shown as current without disclosure of the amount not currently due.

b) The entire receivables are shown as noncurrent.

c) Only the portion currently due is shown as current and the balance as noncurrent.

d) The entire receivables are shown as current with disclosure of the amount not currently due.