Statements about ifrs and gaap accounting

Reference no: EM13823856

1. Which of the following statements about IFRS and GAAP accounting and reporting requirements for the balance sheet is not correct?

(a) Both IFRS and GAAP distinguish between current and non-current assets and liabilities.

(b) The presentation formats required by IFRS and GAAP for the balance sheet are similar.

(d) One difference between the reporting requirements under IFRS and those of the GAAP balance sheet is that an IFRS balance sheet may list long-term assets first.

2. Current assets under IFRS are listed generally:

(a) byimportance.

(b) in the reverse order of their expected conversion to cash.

(d) alphabetically.

3. Companies that use IFRS:

(a) may report all their assets on the statement of financial position at fair value.

(b) are not allowed to net assets (assets 2 liabilities) on their statement of financial positions.

(d) do not have any guidelines as to what should be reported on the statement of financial position.

4. Franco Company uses IFRS and owns property, plant, and equipment with a historical cost of $5,000,000. At December 31, 2013, the company reported a valuation reserve of $690,000. At Decem- ber 31, 2014, the property, plant, and equipment was appraised at $5,325,000. The valuation reserve will show what balance at December 31, 2014?

(a) $365,000.

(b) $325,000.

(d) $0.

5. A company has purchased a tract of land and expects to build a production plant on the land in ap- proximately 5 years. During the 5 years before construction, the land will be idle. Under IFRS, the land should be reported as:

(a) landexpense.

(b) property, plant, and equipment.

(d) a long-term investment.

Reference no: EM13823856

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