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AE 121 > Chapter 19 > Flashcards

Chapter 19 Flashcards

1
Q

What standard covers biological assets and agricultural produce?

A

PAS 41 Agriculture

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2
Q

What is the difference between biological asset and agricultural produce?

A

Biological Asset - living animal or plant
Agriculture Produce - harvested produce of the entity’s biological assets

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3
Q

This is the detachment of produce from a biological asset or the cessation of a biological asset’s life processes.

A

Harvest

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4
Q

True or False: Accounting for biological assets and agricultural produce are the same.

A

False.

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5
Q

True or False: All items under biological assets and agricultural produce are included in the PAS 41, Agriculture.

A

False.

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6
Q

True or False: Animals displayed in zoos, bearer plants and plants used in landscaping and ornamentation are under PAS 41.

A

False.

They are under PAS 16, PPE

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7
Q

True or False: Pets sold in pet shop and potted plants sold commercially are under PAS 41.

A

False.

They are under PAS 2, Inventories

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8
Q

True or False: Agricultural produce after the date of harvest are part of PAS 2 Inventories and not PAS 16, PPE.

A

True.

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9
Q

True or False: Bearer animals are part of PAS 16, PPE and not PAS 41, Agriculture.

A

False.

It is under PAS 41

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10
Q

True or False: Land used in agricultural activities are part of PAS 41, Agriculture.

A

False.

It is under PAS 16, PPE.

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11
Q

This is the management by an entity of the biological transformation and harvest biological assets for sale or for conversion into agricultural produce or into additional biological assets.

A

Agricultural Activity

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12
Q

Which paragraph of the PAS 41 defines agricultural activity?

A

Paragraph 5

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13
Q

This is the asset change through an increase in quantity or improvement in quality of an animal or plant.

A

Growth

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14
Q

This is the asset change through a decrease in the quantity or deterioration in quality of an animal or plant.

A

Degeneration

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15
Q

This is the creation of additional living animals or plants.

A

Procreation

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16
Q

This is the change of biological assets.

A

Biological Transformation

17
Q

True or False: PAS 41 requires agricultural biological assets be classified as either consumable or bearer biological assets.

A

False.

It is not required rather only encouraged.

18
Q

These are biological assets that are to be harvested as agricultural produce or sold as biological assets.

A

Consumable biological assets

19
Q

These are biological assets that are not agricultural produce but, rather, are held to bear produce.

A

Bearer biological assets

20
Q

Bearer or Consumable biological assets:
1. Livestock intended for the production of meat.
2. Fish in farm
3. Fruit trees from which fruit is harvested
4. Trees being grown for lumber.
5. Sheep from the wool is harvested.
6. Crops such as maize and wheat.
7. Livestock from which milk is produced.
8. Chickens from which egg is produced.
9. Produce on a bearer plant
10. Livestock held for sale.

A
  1. Consumable
  2. Consumable
  3. Bearer
  4. Consumable
  5. Bearer
  6. Consumable
  7. Bearer
  8. Bearer
  9. Consumable
  10. Consumable
21
Q

This is a living plant that is used in the production or supply of agricultural produce, expected to bear produce for more than one period, and has a remote likelihood of being sold.

A

Bearer Plants

22
Q

How are biological assets measured initially?

A

On initial recognition

23
Q

How are biological assets measured at the end of each reporting period?

A

Fair value less costs to sell

24
Q

This is the price that would be received to sell an asset.

A

Fair value

25
Q

These are incremental costs directly attributable to the disposal of an asset.

A

Costs to sell

26
Q

True or False: Transport costs are deducted as part of costs to sell.

A

False.

It is assumed that transport costs are already deducted at initial measurement.

27
Q

These are the changes in FVLCTS due to changes in physical characteristics arising from biological transformation.

A

Physical Change

28
Q

These are the changes in FTLCTS due to changes in market prices, without regard to changes in physical attributes.

A

Price Change

29
Q

True or False: PAS 41 specifies the accounting treatment for the related subsequent costs incurred by an entity.

A

False.

30
Q

True or False: The IASB opined that an entity adopts either of two methods in accounting for subsequent costs of biological assets.

A

True

31
Q

True or False: The net amount reported under the profit or loss is the same under both methods of accounting for subsequent costs of biological assets.

A

True.

32
Q
A

AE 121 (14 decks)

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