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Free ACCA Financial Reporting Practice Questions & Answers

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Question 61

Which of the following is the correct treatment of research costs under generally accepted accounting principles?

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Question 62

What is the purpose of a revaluation reserve?

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Question 63

When an asset is revalued upward and there is no previous revaluation deficit, the gain is recognised in:

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Question 64

When an asset with an existing revaluation surplus is impaired, the impairment loss is first:

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Question 65

Which of the following is NOT a valid method for presenting cash flows from operating activities?

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Question 66

In the indirect method of preparing the operating cash flow section, depreciation is:

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Question 67

An increase in trade receivables during the year, in the context of the indirect method cash flow statement, is shown as:

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Question 68

Interest paid is classified in the cash flow statement as:

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Question 69

Tax paid appears in which section of the cash flow statement?

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Question 70

Cash and cash equivalents in the cash flow statement include:

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Question 71

Which of the following items appears in the financing activities section of the cash flow statement?

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Question 72

Which of the following is a characteristic of cash equivalents?

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Question 73

A company has profit before tax of 300,000. Depreciation is 40,000. Trade receivables increased by 25,000. Inventory decreased by 15,000. Trade payables decreased by 10,000. Tax paid was 80,000. What is net cash from operating activities?

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Question 74

A company issues shares at a premium. Which two equity accounts are affected?

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Question 75

Which of the following is NOT a recognised basis of measurement under the IASB Conceptual Framework?

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Question 76

An entity receives a government grant to fund staff training costs. The grant should be recognised in income:

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Question 77

Which of the following is NOT a criterion for recognising a provision?

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Question 78

Under which circumstances can a provision recognised in a prior year be reversed?

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Question 79

What is the difference between a current liability and a provision?

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Question 80

An entity has been operating a customer loyalty points scheme for three years. At year end, 500,000 points remain outstanding and historically 80% are redeemed. Each point is worth 0.01. What provision/liability should be recognised?

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Question 81

Events after the reporting period are events that occur between:

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Question 82

A major customer of an entity goes into administration two months after year end. At year end, the trade receivable balance was 150,000. This is:

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Question 83

A business announces a major acquisition two weeks after year end. This is:

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Question 84

A company has a legal obligation to restore a site at the end of 15 years. The estimated future cost is 1,000,000. The present value using an 8% discount rate is 315,000. The provision should be recognised at:

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Question 85

Which of the following would be classified as an investing activity in a cash flow statement?

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Question 86

A company's cash flow statement shows net cash from operating activities of 600,000 but net profit is only 200,000. Which of the following could explain the difference?

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Question 87

Which of the following is the correct treatment when the recoverable amount of a previously impaired asset increases?

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Question 88

An entity has a constructive obligation to clean up environmental damage caused by its operations. The most probable cost is 500, but it could range from 200 to 800. What amount should be recognised as a provision?

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Question 89

A company is being sued for breach of contract. Legal advisers estimate a 70% probability of losing and an estimated settlement of 300,000. How should this be treated?

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Question 90

An entity is restructuring and wants to recognise a restructuring provision. Which condition is NOT required for recognition?

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Free ACCA Financial Reporting Practice Questions & Answers

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Before you go, can we ask you one thing?

Thank you