Admission Test Financial-Accounting-Reporting Exam Syllabus Topics:
| Section | Weight | Objectives |
|---|---|---|
| Select Transactions | 25-35% | - Subsequent Events and Fair Value Disclosures - Fair Value Measurements - Derivatives and Hedge Accounting - Business Combinations and Consolidations - Leases |
| Select Financial Statement Accounts | 30-40% | - Liabilities - Equity - Revenue Recognition - Assets - Expenses and Other Items |
| Financial Reporting | 30-40% | - State and Local Government Reporting - Financial Reporting for Nonprofits - Conceptual Framework and Standard-Setting - Special Purpose Frameworks - General Purpose Financial Statements |
Admission Test Certified Public Accountant (Financial Accounting & Reporting) Sample Questions:
1. 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
The equipment that Quo manufactures is sold with a five-year warranty. Because of a production breakthrough, Quo reduced its computation of warranty costs from 3% of sales to 1% of sales.
List A (Select one)
A) Correction of an error in previously presented financial statements.
B) Change in accounting principal.
C) Change in accounting estimate.
D) Neither an accounting change nor an accounting error.
2. 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) $0
B) $115,000
C) $55,000
D) $95,000
3. Which of the following types of entities are required to report on business segments?
A) Publicly-traded enterprises.
B) Joint ventures.
C) Nonpublic business enterprises.
D) Not-for-profit enterprises.
4. The following costs were incurred by Griff Co., a manufacturer, during 1992:
What amount of these costs should be reported as general and administrative expenses for 1992?
A) $550,000
B) $260,000
C) $635,000
D) $810,000
5. A development stage enterprise should use the same generally accepted accounting principles that apply to established operating enterprises for:
A) Option A
B) Option D
C) Option C
D) Option B
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: A | Question # 3 Answer: C | Question # 4 Answer: B | Question # 5 Answer: A |
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