Accounting for Government & NPO Final Exam

During the period, Entity A acquires an item of PPE in a foreign currency transaction. As at the reporting date, the payment is not yet settled; however, the PPE was delivered and accepted. Which of the following would need to be translated at the reporting date?

• The related payable
• The cost of the PPE
• The depreciation expense
• All of these
• None of the choices

The grantor in a service concession arrangement is a:

• A. Government entity

• B. Private entity

• Controlled entity
• A or B
• None of the choices

According to the GAM for NGAs, a service concession asset is initially measured at:

• A. Cost

• Fair value

• B. Fair value less costs to sell

• Either A or B
• None of the choices

Which of the following is a joint venture that is classified as ‘jointly controlled assets’?

• Contribute money to acquire land and subdivide it; each gets a titled share
• Contribute capital to form a new entity and get shares
• Coproduce product using existing facilities and share in revenue
• Acquire a warehouse with shared use and maintenance cost
• None of the choices

Which of the following is not one of the forms of joint ventures under the GAM for NGAs?

• Jointly controlled operations
• Jointly controlled net assets
• Jointly controlled assets
• Jointly controlled entities
• None of the choices

A separate set of books of accounts would most likely be established in this type of joint venture:

• Jointly controlled operations
• Jointly controlled journals and ledgers
• Jointly controlled assets
• Jointly controlled entities
• None of the choices

According to the GAM for NGAs, spot exchange rate is:

• The exchange rate for immediate delivery
• The exchange rate at the reporting date
• The ratio of exchange for two currencies
• A currency other than the functional currency of the entity
• None of the choices

According to the PPSAS, a service concession asset is an asset used to provide public services in a service concession arrangement that:

• The operator constructs, develops, or acquires from a third party
• Is an existing asset of the operator
• Is an existing asset of the grantor
• Any of these
• None of the choices

Entity A acquires a machine for $10,000 on Nov. 1, 20x1, on account, and settles on Jan. 3, 20x2. Useful life: 5 years; residual value: 5%. Exchange rates: Nov 1: ₱50, Dec 31: ₱40, Jan 3: ₱45. What is the net forex gain (loss)?

• 10000
• -10000
• -5000
• 5000
• None of the choices

According to the GAM for NGAs, exchange differences on nonmonetary items are recognized in:

• A. Surplus or deficit

• B. Equity

• A or B
• Not recognized
• None of the choices