Revenue Recognition

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Questions Bank

The Framework for Financial Reporting
Accounting Judgements
Statements of Income and Comprehensive Income
Statements of Financial Position and Changes in Equity; Disclosure Notes
The Statement of Cash Flows
Revenue Recognition
Financial Assets: Cash and Receivables
Cost-Based Inventories and Cost of Sales
Long-Lived Assets
Depreciation, Amortization, and Impairment
Financial Instruments: Investments in Bonds and Equity Securities

All Questions

Question 1

Free

True/False

Under income tax laws and regulations a corporation that sustains a net operating loss for the current year may elect to carry back and/or carry forward the loss for income tax purposes.

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True

False

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Question 2

Free

True/False

Net operating tax carry backs and carry forwards never result in a cash refund of prior taxes paid but may result in a reduction in taxes for subsequent years.

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True

False

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Question 3

Free

True/False

The use of a valuation allowance account is mandatory under IFRS.

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True

False

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Question 4

Free

True/False

If a corporation incurs a taxable loss,they are entitled to carry the loss back for three years or forward for twenty years.

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True

False

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Question 5

Free

True/False

Under ASPE,deferred income tax assets due to carry forwards may or may not be recognized,depending whether the company uses the taxes payable method.

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True

False

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Question 6

True/False

Companies normally apply tax loss carry backs sequentially.

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Question 7

True/False

A tax loss represents the present and deferred benefit that the company will be able to realize from the tax loss through a reduction of income taxes paid to governments.

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Question 8

True/False

A company will show the same income tax expense/benefit regardless of whether or not a valuation allowance account is used.

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Question 9

True/False

A tax benefit represents the present and deferred benefit that the company will be able to realize from the tax loss through a reduction of income taxes paid to governments.

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Question 10

True/False

Under current law,at the end of the year of loss or anytime during the next 15 years,a company may select to either carry back or carry forward-only the loss.

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True

False

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Question 11

True/False

In general,deferred income tax assets due to tax loss carry forwards only to the extent that they are likely to be realized.

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Question 12

True/False

The terms "probable" and "more likely than not" refer to probabilities that are greater than or equal to 50%.

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Question 13

True/False

Under IFRS,the income tax expense pertaining to continuing operations must be presented on the face of the income statement.

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Question 14

True/False

Taxes are recovered at the rate at which it was originally paid.The tax rate in the year the loss occurs is not relevant.

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Question 15

True/False

Taxes are recovered at the tax rate in effect during the year of the loss.

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Question 16

True/False

The amount of any unused tax losses must be disclosed on the face of the income statement.

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Question 17

True/False

The recovery of income tax expense is credited to income tax expense (recovery)account.

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Question 18

True/False

A company carrying back a loss must use the earliest year first.

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Question 19

True/False

In the year in which a tax loss is incurred,the tax loss must equal the net loss reported on the company's financial statements.

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Question 20

True/False

CCA is an optional deduction and may be adjusted downwards in order to create taxable income.

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