FAR Quiz Average Round

Income taxes were discussed under PAS___?

In a corporate form of business organization, legal capital is best defined as

• the amount of capital the state of incorporation allows the company to accumulate over its existence

• the par value of all capital stock issued

• the amount of capital the federal government allows a corporation to generate

• the total capital raised by a corporation within the limits set by the Securities and Exchange Commission

Which of the following is not acceptable treatment for the presentation of current liabilities?

• Listing current liabilities in order of maturity

• Listing current liabilities according to amount

• Offsetting current liabilities against assets that are to be applied to their liquidation

• Showing current liabilities immediately below current assets t o obtain a presentation of working capital

The “amortized cost” of bonds payable means

• Face amount plus premium on bonds payable

• Face amount minus discount on bonds payable

• Face amount minus bond issue costs

• Face amount plus premium on bonds payable, minus discount on bonds payable and minus bond issue costs

In order of priority, equity instruments issued to extinguish a financial liability shall be measured first at _________?

• Par value of the equity instrument issued

• Fair value of the liability extinguished

• Carrying amount of liability extinguished

• Fair value of the equity instrument issued

A present obligation that is probable and the amount can be measured reliably is called?

During the year, Jantz Company made an entry to write off a $4,000 uncollectible account. Before this entry was made, the balance in accounts receivable was $50,000 and the balance in the allowance account was $4,500. The net realizable value of accounts receivable after the write-off entry was

• $50,000

• $49,500

• $41,500

• $45,500

On December 1, 2007, Lynn Corporation exchanged 20,000 shares of its $10 par value common stock held in treasury for a used machine. The treasury shares were acquired by Lynn at a cost of $40 per share, and are accounted for under the cost method. On the date of the exchange, the common stock had a market value of $55 per share (the shares were originally issued at $30 per share). As a result of this exchange, Lynn's total stockholders' equity will increase by

• 200,000

• 800,000

• 1,100,000

• 900,000

• 39,370

• 38,940

• 38,490

• 38,470

A P1,000,000, 180-day, 12% note dated July 1 was received from a customer and discounted without resource on August 30 at 15% discount rate.

Maturity value is ___.

• 1,600,000

• 1,007,000

• 1,700,000

• 1,060,000