Day 15 - 57% FAIL

Question 1

A donor donated $1m to a NFP in year and instructed the principal to be used to purchase securities. The NFP bank deposited $2,000 of interest on the deposit. What amount should be included as current assets in the NFP Stmt of financial position?

Answer 1

$2,000

The $1m is restricted and classified as Non-Current Asset

MCQ-01268

Question 2

Net Realizable Value =

Answer 2

Selling price LESS Cost to Complete

MCQ-06046

Question 3

ABC bought Tesla stock for $190k on Jan 1, at the end of the first qtr the stock price was $182k. How should the decline in stock value be reflected?

Answer 3

Recognize unrealized loss of $8k as part of continuing operations in the income Stmt

Unrealized losses in an AFS equity securities must be included in the IS

MCQ-07484

Question 4

What would cause an increase in DTL?

Answer 4

1. Increase in prepaid insurance - would be deducted for tax in the year paid and for book it would be deducted the following year of coverage
2. Increase in rent receivable - income earned but not yet received in cash. Tax will be paid in the following year when cash is received

Increase in warranty obligations = expenses incurred and not paid THUS does not increase DTL in CY

MCQ-00818

Question 5

ABC failed to record warranty costs last year. How should this be treated?

Answer 5

As a correction of error and a prior period adjustment is needed

MCQ-00069

Question 6

Freight Out is what type of expense?

Answer 6

Selling Expense AND IS NOT INCLUDED IN COGS

MCQ-04465

Question 7

Fair value is a _____-specific measurement

Answer 7

Market-Specific

NOT entity

MCQ-05407

Question 8

Unrealized gains and losses on AFS are recorded in:

Answer 8

OCI

MCQ-11093

Question 9

ABC purchased bonds at a discount on the open market for an investment and intends to hold until maturity. How should the bonds be recorded?

Answer 9

At Amortized Cost

Classified as Held to Maturity

MCQ-00266