11 a company does not have to disclose information about the sale of a discontinued 4313940

11 a company does not have to disclose information about the sale of a discontinued 4313940

11.A company does not have to disclose information about the sale of a discontinued component in the notes to its financial statements until the actual sale has occurred.

a.True

b.False

12.Any disposal of a large number of long-lived assets can appropriately be reported in the income statement as results from discontinued operations.

a.True

b.False

13.There is no prescribed income statement format under IFRS whereas U.S. GAAP requires the use of the single-step or the multiple-step format.

a.True

b.False

14.To compute earnings per share the denominator is net income attributable to common shareholders less any preferred stock dividends for the period.

a.True

b.False

15.Under U.S. GAAP or IFRS, a company can either report its comprehensive income or loss under present net income and comprehensive income in a single continuous performance statement or report it in a separate but consecutive financial statement.

a.True

b.False

16.Gains or losses associated with derivative financial instruments would be included in income from continuing operations.

a.True

b.False

17.The information contained in the statement of cash flows allows external users to assess a company’s risk, liquidity, financial flexibility, and operating capability.

a.True

b.False

18.The most common way in which to prepare the statement of cash flows is the indirect method, which is encouraged by FASB.

a.True

b.False

19.Companies with lower coverage ratios have a greater risk and a lower financial flexibility.

a.True

b.False

20.The SEC scrutinizes reported earnings numbers to assess the quality of earnings and to detect any potential for earnings management.

a.True

b.False

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