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F1 Exam Dumps : Financial Reporting

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Financial Reporting Questions and Answers

Question 1

ABC uses an aggressive approach to managing its working capital. XYZ uses a conservative approach to managing its working capital.

Which of the following is ABC more at risk of compared to XYZ?

Options:

A.

Inventory obsolescence

B.

Running out of cash

C.

High finance costs

D.

Receivables not paying on time

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Question 2

UK purchased an asset, with a useful economic life of 10 years, on 1 January 20X5 for $40,000. The asset was revalued on 31 December 20X6 to 544,000 and the directors believed its total useful economic life remained unchanged On 31 December 20X7 UK sells the asset for $50,000

How much will be recorded as a profit on disposal of the asset in UK's statement of profit or loss for the year ended 31 December 20X7?

Give your answer to the nearest $.

Options:

Question 3

Which of the following would NOT be a source of taxation rules for a country?

Options:

A.

Double tax treaties

B.

Directives from international bodies

C.

International accounting standards

D.

Precedents based on previous legislation