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Question 1
Free
True/False

IAS 1 permits an entity to present all items of income and expense recognised in a period to be presented in either the statement of comprehensive income or the statement of profit and loss.

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True

False

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Question 2
Free
True/False

Comprehensive income includes dividend payments to shareholders.

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True

False

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Question 3
Free
True/False

Discovery of an error from a prior period corrected retrospectively is an example of an item reportable under other comprehensive income.

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True

False

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Question 4
Free
True/False

IAS 1 requires profit or loss and the total comprehensive income for the period reported on the face of the statement of comprehensive income to be disaggregated between the non-controlling interest and the owners of the parent.

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True

False

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Question 5
Free
True/False

IAS 1 permits entities to present the components of other comprehensive income either before tax effects (gross presentation)or after their related tax effects (net presentation).

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True

False

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Question 6
True/False

An entity shall recognise all items of income and expense in a period in profit or loss unless an International Financial Reporting Standard requires or permits otherwise.

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True
False
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Question 7
True/False

The statement of profit or loss (income statement)under IAS 1 is designed to report all revenues and expenses to determine profit or loss.

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True
False
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Question 8
True/False

By focusing only on the statement of profit and loss,we do not obtain a full picture of all the gains and losses that may have occurred for an entity during the period.

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True
False
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Question 9
True/False

In establishing the classification of items in the statement of profit and loss,the size of an item is an appropriate basis for establishing a separate classification (by nature or function)for it.

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True
False
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Question 10
True/False

Profit is a measure of financial performance and therefore may not truly reflect the success or otherwise of an organisation.

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True
False
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Question 11
True/False

IFRS 2 requires that the fair value of the option issued as a share-based payment to an employee,be determined and this value be deemed to be the cost of the options.

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True
False
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Question 12
True/False

As part of the process of international harmonisation,standard setters have removed the need for professional judgment to be exercised in respect of expenses; all discretion that once existed has been removed.

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True
False
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Question 13
True/False

The choice between reporting expenses by nature or by function is extremely important,as different net profit figures are derived depending upon the choice made.

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True
False
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Question 14
Short Answer

All disclosure requirements that relate to an entity's profit or loss are included in IAS 1.
FALSE

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Question 15
True/False

IAS 8 requires all errors that relate to prior reporting periods to be corrected by adjusting the opening balance of retained earnings and restating comparative information.

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True
False
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Question 16
True/False

Changes in accounting policy are to be made retrospectively or prospectively,depending upon the background to the change.

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True
False
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Question 17
Multiple Choice

A statement displaying components of profit or loss is referred to in IAS 1 as a(n):

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A
profit and loss statement.
B
statement of income.
C
income statement.
D
statement of profit and loss.
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Question 18
Multiple Choice

Under IAS 1 additional line items,headings and subtotals:

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A
are precluded as they provide unnecessary information that may confuse the user.
B
shall be presented on the face of the statement when such presentation is relevant to an understanding of the entity's financial performance.
C
shall be presented on the face of the statement when such items can be measured reliably and it is probable these events will occur.
D
will only be included in the notes to the statement of profit and loss if they are relevant to an understanding of the entity's financial performance.
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Question 19
Multiple Choice

Examples of classification of expenses by their nature are:

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A
employee expenses and distribution expenses.
B
depreciation and marketing expenses.
C
borrowing costs and distribution expenses.
D
employee expenses and depreciation expenses.
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Question 20
Multiple Choice

The choice of classification between nature and function of expenses from ordinary activities depends on:

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A
the size of the items that would be reported under the possible classifications.
B
the historical evidence about the probability of the items recurring.
C
the classification that provides information that is reliable and more relevant.
D
the classification that best reflects the way expenses vary directly or indirectly with the entity's level of activity.
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