Accounting Standards Quiz

What is the core principle of PFRS 8 Operating Segments?

• To disclose information about financial instruments

• To evaluate the nature and financial effects of business activities

• To enable users to evaluate the business activities and economic environments

• To identify reportable segments based on internal reports

What is the definition of a business combination according to PFRS 3?

• A transaction where an entity invests in a subsidiary exclusively for resale

• A transaction where an entity obtains control of one or more businesses

• A transaction where an entity acquires goods or services in exchange for shares

• A transaction where an entity disposes of a major line of business

What is the core principle of PFRS 5 Non-current assets Held for Sale and Discontinued Operations?

• To classify non-current assets as current assets

• To present the results of discontinued operations separately

• To recognize and measure goodwill on acquisition date

• To disclose information about financial instruments

What is the scope of PFRS 6 Exploration for and Evaluation of Mineral Resources?

• Applies to publicly listed entities only

• Applies to exploration and evaluation of renewable resources

• Applies to exploration and evaluation of mineral resources

• Applies to entities engaged in manufacturing

What is the objective of PFRS 7 Financial Instruments: Disclosures?

• To disclose information about operating segments

• To provide information about financial instruments

• To enable users to evaluate the business activities and economic environments

• To evaluate the nature and financial effects of business activities

What is the definition of control in a business combination according to PFRS 3?

• When the ownership interest acquired is more than 50%

• When the acquirer has the power to cast the majority of votes

• When the acquirer has the power to control the financial policies

• When the acquirer has the power to appoint the board of directors

What is the significance of financial instruments according to PFRS 7?

• To evaluate the nature and financial effects of business activities

• To disclose information about financial instruments

• To enable users to evaluate the business activities and economic environments

• To provide information about operating segments

What is the core principle of PFRS 1 First-time Adoption of Philippine Financial Reporting Standards?

• To prepare and present an opening statement of financial position

• To present at least one-year comparative information

• To apply PFRSs in measuring all recognized assets and liabilities

• To recognize and measure assets and liabilities retrospectively

What is the scope of PFRS 2 Share-based Payments?

• Applies to equity-settled share-based payment transactions only

• Applies to cash-settled share-based payment transactions only

• Applies to all share-based payment transactions

• Applies to share-based compensation plans with cash alternatives

What is the core principle of PFRS 6 Exploration for and Evaluation of Mineral Resources?

• To recognize exploration and evaluation expenditures as expenses

• To measure exploration and evaluation assets at fair value

• To capitalize exploration and evaluation expenditures as assets

• To apply the cost model for exploration and evaluation assets