Admission Test Financial-Accounting-Reporting Valid Dump : Certified Public Accountant (Financial Accounting & Reporting)

Financial-Accounting-Reporting real exams

Exam Code: Financial-Accounting-Reporting

Exam Name: Certified Public Accountant (Financial Accounting & Reporting)

Updated: Jul 01, 2025

Q & A: 161 Questions and Answers

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Admission Test Certified Public Accountant (Financial Accounting & Reporting) Sample Questions:

1. Tanker Oil Co., a development stage enterprise, incurred the following costs during its first year of operations:

Tanker had no revenue during its first year of operation. What amount may Tanker capitalize as organizational costs?

A) $115,000
B) $95,000
C) $0
D) $55,000


2. Which of the following is true regarding the comparison of managerial to financial accounting?

A) Managerial accounting has a past focus and financial accounting has a future focus.
B) Managerial accounting is generally more precise.
C) Managerial accounting need not follow generally accepted accounting principles (GAAP) while financial accounting must follow them.
D) The emphasis on managerial accounting is relevance and the emphasis on financial accounting is timeliness.


3. On January 2, 1993, Quo, Inc. hired Reed to be its controller. During the year, Reed, working closely with Quo's president and outside accountants, made changes in accounting policies, corrected several errors dating from 1992 and before, and instituted new accounting policies.
Quo's 1993 financial statements will be presented in comparative form with its 1992 financial statements.
This question represents one of Quo's transactions. List A represents possible clarifications of these transactions as: a change in accounting principle, a change in accounting estimate, a correction of an error in previously presented financial statements, or neither an accounting change nor an accounting error.
Item to Be Answered
As a result of a production breakthrough, Quo determined that manufacturing equipment previously depreciated over 15 years should be depreciated over 20 years.
List A (Select one)

A) Change in accounting principal.
B) Correction of an error in previously presented financial statements.
C) Neither an accounting change nor an accounting error.
D) Change in accounting estimate.


4. A material loss should be presented separately as a component of income from continuing operations when it is:

A) Not unusual in nature but infrequent in occurrence.
B) An extraordinary item.
C) A cumulative effect type change in accounting principle.
D) Unusual in nature and infrequent in occurrence.


5. What is the purpose of information presented in notes to the financial statements?

A) To provide recognition of amounts not included in the totals of the financial statements.
B) To present management's responses to auditor comments.
C) To provide disclosures required by generally accepted accounting principles.
D) To correct improper presentation in the financial statements.


Solutions:

Question # 1
Answer: C
Question # 2
Answer: C
Question # 3
Answer: D
Question # 4
Answer: A
Question # 5
Answer: C

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