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CPA FAR Test from GLEIM 40 Practice Questions 100% Solved
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CPA FAR Test from GLEIM 40 PracticeQuestions
A - answerThe information provided by financial reporting pertains to
A, Individual business enterprises rather than to industries or an economy as a whole,
or members of society as consumers..
B. Individual business enterprises and industries rather than to an economy as a whole
or to members of society as consumers.
C. Individual business enterprises and an economy as a whole rather than to industries
or to members of society as consumers.
D. Individual business enterprises, industries, and an economy as a whole rather than
to members of society as consumers.
D - answerAccording to the FASB's conceptual framework, the process of reporting an
item in the financial statements of an entity is
A, Allocation.
B. Matching.
C. Realization.
D. Recognition.
A - answerMill Co.'s trial balance included the following account balances at December
31, Year 6:
Accounts payable -$15,000
Bonds payable, due Year 7 -25,000
Discount on bonds payable, due Year 7 -3,000
Dividends payable 1/31/Year 7 - 8,000
Notes payable, due Year 8 - 20,000
What amounts should be included in the current liability section of Mill's December 31,
Year 6, balance sheet?
A. $45,000
B. $51,000
C. $65,000
D. $71,000
A - answerThe statement of shareholders' equity shows a
, A. Reconciliation of the beginning and ending balances in shareholders' equity
accounts.
B.Listing of all shareholders' equity accounts and their corresponding dollar amounts.
C. Computation of the number of shares outstanding used for earnings per share
calculations.
D. Reconciliation of net income to net operating cash flow.
B - answerA company had the following outstanding shares as of January 1, Year 2:
Preferred stock,
$60 par, 4%, cumulative -10,000 shares
Common stock, $3 par - 50,000 shares
On April 1, Year 2, the company sold 8,000 shares of previously unissued common
stock. No dividends were in arrears on January 1, Year 2, and no dividends were
declared or paid during Year 2. Net income for Year 2 totaled $236,000. What amount is
basic earnings per share (BEPS) for the year ended December 31, Year 2?
A. $3.66
B. $3.79
C. $4.07
D. $4.21
B - answerOn June 30, Year 4, Mill Corp. incurred a $100,000 net loss from disposal of
a component. Also, on June 30, Year 4, Mill paid $40,000 for property taxes assessed
for the Year 4 calendar year. What amount of the foregoing items should be included in
the determination of Mill's net income or loss for the 6-month interim period ended June
30, Year 4?
A. $140,000
B. $120,000
C. $90,000
D. $70,000
B - answerGiaconda, Inc., acquires an asset for which it will measure the fair value by
discounting future cash flows of the asset. Which of the following terms best describes
this fair value measurement approach?
A. Market.
B. Income.
C. Cost.
D. Observable inputs.
C - answerCompanies A and B begin with identical account balances, and their
revenues and expenses for the year are identical in amount except that Company A has
a higher ratio of cash to noncash expenses. If the cash balances of both companies
increase as a result of operations (no financing or dividends), the ending cash balance
of Company A as compared to that of Company B will be
A. Higher.
B. The same.
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