Day 14

Question 1

Interest Paid on a discount bond in a given period is:

Think of the equation

Answer 1

Discount = Interest Expense - Interest Payment

Interest Payment = Interest Expense - Discount

MCQ-01251

Question 2

Under US GAAP, what pension plan transaction will impact OCI?

Answer 2

1. Prior service costs (in the period incurred) and the amortization of prior service costs (in future periods) will impact OCI
2. Gains from the actual return exceeding the expected return on plan assets
3. The increase in plan benefits applied retroactively

Note: Contributions to a plan made by the company itself WILL NOT impact OCI

MCQ-07437

Question 3

What are Cash Flows from Financing Activities:

Answer 3

• Proceeds from Issuance of Stock
• Dividends Paid

MCQ-05698

Question 4

NYC received a $15 million federal grant to finance the construction of a substance abuse rehabilitation center. The proceeds of this grant should be accounted for in the:

Answer 4

Capital Projects Funds

MCQ-01178

Question 5

Common and Preferred stock are recorded at the number of shares issued times____?

What is the JE?

Answer 5

Times the Stated Par Value

Dr - Cash
Cr - Common Stock
Cr - Paid-In Capital

Dr - Cash
Cr - Preferred Stock
Cr - Paid-In Capital

MCQ-01061

Question 6

ABC records tax depreciation in excess of book and accrues warranty expense in the period in which the sales are recognized. Under US GAAP ABC would display:

Answer 6

NET Non-Current Deferred Tax Asset (warranty exp.) & NET Non-Current Deferred Tax Liability (tax depreciation)

Deferred Tax Asset = FUTURE DEDUCTIONS

Deferred Tax Liability = FUTURE INCOME

MCQ-04517
MCQ-04504

Question 7

DTL = Future Tax Income > Future Financial Income = Pay Taxes Later

Answer 7

MCQ-00829

Question 8

DTA = Future Tax Income < Future Financial Income = Pay Taxes Early

Answer 8

MCQ-00829

Question 9

Common Derivatives: OFFS

Answer 9

Option Contract -

Futures Contract -

Forward Contract -

Swap Contract -

MCQ-07997