ACCA ACCA Financial Reporting Standards

Question 1

Under IFRS 15, when should revenue from contracts with customers be recognized?

Accepted Answer

When the performance obligation is satisfied

Answer

When cash is received from the customer

Answer

When the contract is signed

Answer

When the invoice is issued

Question 2

According to IAS 16, which cost elements can be capitalized as part of property, plant and equipment (PPE)?

Accepted Answer

Purchase price, directly attributable costs, and initial dismantling estimates

Answer

Purchase price plus all subsequent maintenance costs

Answer

Purchase price only, excluding taxes

Answer

All costs incurred before and after the asset is in use

Question 3

Under IAS 36, what is an 'impairment loss' on an asset?

Accepted Answer

The excess of carrying amount over recoverable amount

Answer

The excess of recoverable amount over carrying amount

Answer

The difference between cost and accumulated depreciation

Answer

The fair value less replacement cost

Question 4

What is the key distinction between 'finance leases' and 'operating leases' under IFRS 16?

Accepted Answer

IFRS 16 eliminates the distinction; lessees recognize a right-of-use asset for all leases

Answer

Finance leases must be capitalized but operating leases remain off-balance sheet

Answer

Operating leases transfer ownership; finance leases do not

Answer

Finance leases apply only to equipment; operating leases apply to property

Question 5

Under IAS 2, how should inventories be measured on the balance sheet?

Accepted Answer

At the lower of cost and net realizable value

Answer

At cost only

Answer

At net realizable value only

Answer

At the higher of cost and net realizable value

Question 6

Which IFRS standard governs the accounting for income taxes, including deferred tax?

Accepted Answer

IAS 12

Answer

IAS 19

Answer

IFRS 9

Answer

IAS 37