ACAFA

Under IFRS 15, how shall revenue from contracts with customers such as revenue from initial franchise fee be recognized by the franchisor? a. When the franchisor satisfies the performance obligation under the franchise agreement b. Upon signing of the franchise agreement. c. Applying the legality over the substance of the transaction d. Upon receipt of the initial franchise fee by the franchisor

a. When the franchisor satisfies the performance obligation under the franchise agreement

Which of the following is not a forecasted transaction that could be hedged to prevent a loss on the transaction(s) as proposed to the potential loss of forecasted transaction? a. A domestic company's budgeted export revenues? b. An expected decrease in domestic export sales if the dollar strengthens c. A foreign subsidiary's budgeted revenues d. A foreign subsidiaries budgeted dividends remittance

not sure

Which of the following will not result in the dissolution of a partnership? 1. Partners are incompatible and choose to cease operations 2. Partners realize that the profit figures have failed to reach projected levels. 3. Retirement of a partner 4. Death of a partner a. 3 and 4 only b. Neither 1, 2, 3 and 4 c. 1, 2, 3, and 4 d. 1 and 2 only

not sure

Statement 1: When the goodwill method is applied to recognize the admission of a new partner and the new partner is responsible for the goodwill, the new partner's capital account will be established at the amount of the contribution. Statement 2: When new partner goodwill is recognized at the date the partner joins the partnership, the existing partners' capital accounts do not change as a result of the new partner's admission.

: B

The dissolution of a partnership occurs _____________________. A. Only when the partnership sells its assets and permanently closes its books B. Only when a partner leaves the partnership C. At the end of each year, when income is allocated to the partners D. Only when a new partner is admitted to the partnership E. When there is any change in the individuals who make up the partnership

: E

Bruce Chapman was admitted to the Adams & Bye Limited Liability Partnership on May 31, 20x4, by an investment of P40,000 cash for a 20% interest in partnership net assets. Prior to the admission of Chapman, the capital accounts of Adams and Bye, who shared net income and losses equally, had balances of P70,000 and P30,000, respectively. The preferable accounting method for the admission of Chapman includes credits of: A. P6,000 each to the capital accounts of Adams and Bye B. P30,000 each to the capital accounts of Adams and Bye C. P28,000 and 12,000, respectively, to the capital accounts of Adams and Bye D. Some other amounts to the capital accounts of Adams and Bye

A

If existing partners acquire the equity of a withdrawing partner, in what manner do they divide the equity? A. In any manner they choose B. Equally C. Proportionate to their residual profit and loss ratios D. Existing partners are not permitted to acquire the equity of a withdrawing partner

A

Statement 1: It is possible for a new partner's capital account to be established at an amount greater than the market value of the identifiable assets invested. Statement 2: New partners are never recipients of bonuses when they join the partnership.

A

Statement 1: The assumption of a liability by the partnership with regard to a noncash asset contributed to the partnership by a partner will affect the value assigned to the partner's capital account. Statement 2: An asset's carrying value should not be considered when establishing the initial capital accounts of partners. Write the letter of your choice. CAPITAL LETTER A 1st statement is True; 2nd statement is False B 1st statement is False; 2nd statement is True C All statements are True D All statements are False

A

Statement 1: Theoretically, salary allowances paid to partners should not be reflected as salary in the general ledger. Statement 2: The value assigned to noncash assets invested by partners in a limited partnership is the cost of the assets or the current fair value of the assets at the time of investment, whichever is lower.

A

Statement 1: When the goodwill method is applied to recognize the admission of a new partner and the existing partners are responsible for the goodwill, the new partner's capital account will always be established equal to the amount of the contribution to the partnership. Statement 2: The existing partners will always recognize goodwill when a new partner is admitted to the company and the goodwill method is applied.

A

Which of the following statements is true concerning the treatment of salaries in partnership accounting? A. Partner salaries may be used to allocate profits and losses: they are not considered expenses of the partnership B. Partner salaries are equal to the annual partner drawing C. The salary of a partner is treated in the same manner as salaries of corporate employees D. Partner salaries are directly closed to the capital account

A

In a partnership interest on capital investment is accounted for as a(an) A. Return on investment B. Expenses C. Allocation of net income D. Reduction of capital

C

Statement 1: A bonus paid to a new partner results in a reduction to the capital accounts of the existing partners in proportion to their profit and loss sharing ratios. Statement 2: The goodwill method of admitting a new partner to a partnership results in greater total assets than the bonus method of admitting a new partner. Write the letter of your choice. CAPITAL LETTER A 1st statement is True; 2nd statement is False B1st statement is False; 2nd statement is True CAll statements are True DAll statements are False

C

Statement 1: Assigning a non-cash asset the contributor's carrying value could result in a misallocation of gain or loss if the asset is sold. Statement 2: Appraisals are not necessarily required when assigning value to non-cash assets contributed to the partnership.

C

Statement 1: The recognition of a bonus to existing partners at the date a new partner is admitted to a partnership often occurs in lieu of the recognition of goodwill for the existing partners. Statement 2: The bonus recognized by existing partners when a new partner is admitted to a partnership is commonly shared among the existing partners based on the existing partners' relative profit and loss residual ratios.

C

Which method of recording the admission of a new partner into a partnership potentially results in the existing partners' capital accounts changing in value? A. Bonus method B. Goodwill method C. Either bonus method or goodwill method D. Existing partners; capital never change

C

Which of the following is a reason to not revalue partnership assets at the date a new partner is admitted to the partnership? A. There has been a change in ownership B. A new legal entity exists C. The partnership has not ceased operations D. All three are reasons to not revalue partnership assets at the date of a new partner's admission

C

Which of the following is not a criterion for recognizing a bonus to existing partners when a new partner joins the partnership? A. Only cash assets were contributed to the partnership by the new partner B. The existing partners desire to not recognize goodwill on the balance sheet C. The articles of partnership indicate that the bonus method will be used to admit new partners D. The new partner invests more into the partnership that his/her share of total partnership capital after the investment is made

C

Which of the following must be true when a new partner acquires an ownership interest directly from an existing partner? A. Capital must be assigned to the new partner B. The new partner's profit and loss allocation must be proportionate to the capital account balance C. The new partner must be allocated some amount of profit and loss D. The existing partners must provide a list of all the partnership's outstanding liabilities to the new partner

C

Which of the following must occur for a new partner to enter the partnership by acquiring an ownership interest directly from an existing partner? A. Existing partners must know the amount the new partner is paying for the ownership interest B. The new partner must acquire all of the current partner's ownership interest C. Existing partners must approve the admission of the new partner into the partnership D. The new partner must live in the same state as the other partners

C

Which of the following statements presents a reason that goodwill may be recorded with regard to a new partner at the date of that partner's admission to the partnership? A. The existing partnership is worth more than the appraised value of the tangible net assets B. The new partner has a strong desire to become a member of the partnership C. The total value of the new partner's contribution to the partnership is greater than the value of the identifiable net assets contributed D. The new partner's residual interest in profits and losses is greater than 30 percent

C

Revenue from a contract with customer a. Is recognized even if the contract is still wholly unperformed b. Is recognize when the customer receive the rights to receive consideration c. Cannot be recognized until a contract exists d. Can be recognized even when a contract is still pending

Cannot be recognized until a contract exists

Write the letter of your choice. CAPITAL LETTER A 1st statement is True; 2nd statement is False B 1st statement is False; 2nd statement is True C All statements are True D All statements are False Statement 1: The amount that assets are revalued when a new partner joins a partnership is always shared by existing partners equally. Statement 2: If a new partner's capital account is created for an amount less than the value of net assets contributed, an error has been made in the partnership's accounting records.

D

Write the letter of your choice. CAPITAL LETTER A1st statement is True; 2nd statement is False B1st statement is False; 2nd statement is True C All statements are True D All statements are False Statement 1: If a new partner is going to acquire an ownership interest in a partnership directly from another partner, the other partners do not need to approve the admission. Statement 2: If a new partner acquires 40 percent of an existing partner's equity in the partnership, the new partner is also entitled to 40 percent of the existing partner's profit and loss allocation

D

On July 31, Columbia Company contracted to have two products build by DELL Manufacturing for a total of P185,000. The contract specifies that payment will only occur after both products have been transferred to Columbia Company. Columbia determines that the standalone prices are P100,000 for Product 1 and P85,000 for Product 2. On August 1, when Product 1 has been transferred, the journal entry to record this event include a: a. Debit to Contract Assets for P100,000 b. Debit to Accounts Receivable for P85,000 c. Debit to Accounts Receivable for P100,000 d. Debit to Contract Assets for P85,000

Debit to Contract Assets for P100,000

On November 1, 2013, SMART Corporation sold merchandise to DITO Corporation, a foreign firm. SMART measured and recorded the account receivable from the sale at P78,000. DITO paid for the accounts on November 30, 2013. Spot rates for FCU on November 1 and November 30 respectively, were P0.80 and P0.78. if the sale of the merchandise was denominated in FCU, the November 30 entry to record the receipt of payment from DITO Tell include a: a. Debit to Cash for P78,000 b. Credit to Exchange Gain for P1,950 c. Debit to exchange Loss for P1,950 d. Credit to Accounts Receivable for P76,050

Debit to exchange Loss for P1,950

Which of the following is not true about accounting for revenue from franchise arrangements? a. Franchise arrangements typically include one performance b. Franchise arrangements typically include one or more performance obligations for which revenue is recognized at a point in time. c. Franchise arrangements often include a performance obligation for a license as well as for delivery of goods and services. d. Franchise arrangements typically include one or more performance obligations for which revenue is recognized over a period of time?

Franchise arrangements typically include one performance

Which of the following initial amount of revenue agreed in the long-term construction contract, additional revenues may be recognized by the contractor (1) to the extent that it is probable that they will result in revenue and (2) they are capable of being reliably measured. Which of the following will not be considered as additional contract revenue by a contractor?

Gain in sale of scrap materials from construction.

Which of the following initial amount of revenue agreed in the long-term construction contract, additional revenues may be recognized by the contractor (1) to the extent that it is probable that they will result in revenue and (2) they are capable of being reliably measured. Which of the following will not be considered as additional contract revenue by a contractor? a. Variation in contract work as instructed by the customer regarding the scope of work to be performed. b. Incentive payments to be paid to the contractor if specified performance standard are met or exceeded or for early completion of the contract. c. Gain in sale of scrap materials from construction. d. Claim that the contractor or may seek collect from the customer for customer caused delays or errors in specification or design.

Gain in sale of scrap materials from construction.

A bonus recognized by a new partner at the date of admission into the partnership is generally shared by the existing partner's in what way? a. In proportion to salaries. b. In proportion to profit and loss residual ratios c. In proportion to capital account balances d. Equally

In proportion to profit and loss residual ratios

In the liquidation of a limited partnership, a loan payable by the partnership is: a. Liabilities still to be sold b. Paid immediately after all outside creditors have been paid in full c. Considered to be a liability of the partnership d. Paid immediately after all outside creditors have been paid partially

Paid immediately after all outside creditors have been paid in full

Which item is not shown on the schedule of partnership liquidation? a. Liabilities still to be paid b. Current cash balances c. Property owned by the partnership d. Personal assets of the partners:

Personal assets of the partners

The last step in the process for revenue recognition is to a. Allocate transaction price to the separate performance obligations b. Recognize revenue when each performance obligation is satisfied c. Determine the transaction price d. Identify the contract with customers

Recognize revenue when each performance obligation is satisfied

In a simple partnership liquidation, the last remaining cash distribution should be made according to the ratio of: a. The individual partner's profit and loss agreement b. The individual partner's capital accounts, increased by partner loans to the partnership c. The individual partner's capital accounts, decreased by partnership loans to the partners and increased by partner loans to the partnership d. The individual partner's capital accounts, increased by partnership loans to the partners and decreased by partner loans to the partnership

The individual partner's profit and loss agreement

In a simple partnership liquidation, the last remaining cash distribution should be made according to the ratio of a. The individual partner's profit and loss agreement b. The individual partner's capital accounts, increased by partner loans to the partnership c. The individual partner's capital accounts, increased by partnership loans to the partners and decreased by partner loans to the partnership d. The individual partner's capital accounts, decreased by partnership loans to the partners and increased by partner loans to the partnership

not sure

Write the letter of your choice. CAPITAL LETTER A1st statement is True; 2nd statement is False B1st statement is False; 2nd statement is True CAll statements are True DAll statements are False Statement 1: When a new partner is joining a partnership by making a payment to the partnership for an amount more than book value, the partners are required to choose one of three methods of recording the new partner's payment in excess of book value. Statement 2: The revaluation of assets and liabilities at the date a new partner joins the partnership, by investing assets directly into the partnership, does not eliminate the possibility that the partnership might need to record bonuses or goodwill as part of the admission of the new partner.

A

Statement 1: A new partner in a partnership accepts unlimited liability for actions that occurred before that partner joined the partnership. Statement 2:The admission of a new partner into a partnership can occur without any new assets being invested into the partnership.

B

Statement 1: A partner may withdraw from a partnership at any time without notice given to the existing partners. Statement 2: A withdrawing partner may have his/her partnership interest acquired by an outside investor agreed to by the remaining partners, the remaining partners, or the partnership.

B

Statement 1: If existing partners acquire a withdrawing partner's equity, the existing partners must purchase the withdrawing partner's equity in proportion to their residual profit and loss ratios. Statement 2: The revaluation of assets when a partner withdraws from the partnership may be a complete revaluation or a partial revaluation, reflecting the change in value with regard to the withdrawing partner's ownership interest.

B

Statement 1: Proprietorships and partnerships are different in that proprietors have unlimited legal liability while each partner's legal liability is limited to his/her percentage ownership in the partnership. Statement 2: Partnerships are not required to prepare financial statements in accordance with Generally Accepted Accounting Principles unless they have publicly traded debt or are required to follow GAAP by a creditor.

B

Statement 1: The salary portion of the profit and loss allocation is set in the articles of partnership and will not change over time. Statement 2: The salary portion of the partnership profits and loss allocation is not included in the partnership's income statement.

B

What is the underlying purpose of the salary component of allocating partnership profits and losses? A. Compensate partners who contribute economic resources to the partnership B. Reward labor and expertise contributions C. Reward for special responsibilities undertaken D. None of the above

B

Which of the following forms of new partner admission will not result in a change in the partnership's net asset A. Purchase of an ownership interest directly from the partnership B. Purchase of an ownership interest directly from an existing partner C. Either of the above D. Neither of the above

B

Which of the following is not a reason for the popularity of partnerships as a legal form for business? A. Partnerships may be formed merely by an oral agreement B. Partnerships can more easily generate significant amounts of capital C. Partnerships avoid the double taxation of income that is found in corporations D. In some cases, losses may be used to offset gains for tax purposes

B

Which of the following is not an advantage of a partnership over a corporation? A. Ease of formation B. Unlimited liability C. The elimination of taxes at the entity level D. All of the above

B

A bonus recognized by a new partner at the date of admission into the partnership is generally shared by the existing partners in what way? A. Equally B. In proportion to capital account balances C. In proportion to profit and loss residual ratios D. In proportion to salaries

C

A partner's withdrawal of assets from a limited liability partnership that is considered a permanent reduction in that partner's equity is debited to the partner's: A. Drawing account B. Retained earnings account C. Capital account D. Loan receivable account

C

It is a contract specifically negotiated for the construction of an asset or a combination of assets that are closely interrelated or interdependent in terms of their designs, technology and function or their ultimate purpose or use: a. Consignment Contract b. Franchise Contract c. Construction Contract d. Installment Contract

Construction Contract

Which of the following will not result in the dissolution of a partnership? 1. Partners are incompatible and choose to cease operations 2. Partners realize that the profit figures have failed to reach projected levels. 3. Retirement of a partner 4. Death of a partner

Neither 1, 2, 3 and 4

A partner assigned his partnership interest to a third party. Which statement best describes the legal ramifications to the assignee? A. The assignment of the partnership interest does not entitle the assignee to partnership assets upon liquidation. B. The assignment dissolves the partnership. C. The assignee has the right to share in the management of the partnership. D. The assignee does not become a partner but has the right to share in future partnership profits and to receive the proper share of partnership assets upon liquidation.

D

Changes in partnership ownership are presumed to be arm's length transactions that may require which of the following actions? A. recognitions of goodwill to existing partners B. revaluation of existing partnership assets C. recognition of goodwill or other intangible assets attributable to the incoming partner D. all of the above are possible

D

Statement 1:Interest on partnership capital is mandatory in dividing profits and losses. Statement 2: Partners are also employees if they are active in the business of the partnership.

D

Transferable interest of a partner includes all of the following except: A. the partner's share of the profits and losses of the partnership B. the right to receive distributions C. the right to receive any liquidating distribution D. the authority to transact any of the partnership's business operations

D

When a new partner joins a partnership by investing assets into the partnership, what method may be used to record the admission of the new partner? A. Revaluation of existing assets B. Application of the bonus method C. Recognition of goodwill D. Any of the three or a combination may be applied

D

Which of the following results in dissolution of a partnership? A. contribution of additional assets to the partnership by an existing partner B. receipt of a draw by an existing partner C. winding up of the partnership and the distribution of remaining assets to the partners D. withdrawal of a partner from a partnership

D

Which of the following statements is false with regard to the goodwill recognized for a new partner entering a partnership? A. The new partner's capital account balance will exceed the amount invested B. The existing partners' capital accounts will remain unchanged C. The amount invested by the new partner will be less than his/her proportion of the partnership's book value before goodwill is recognized D. The three partners will have equal capital account balances when the transaction is completed

D

Who may acquire the ownership interest of a partner who is withdrawing from a partnership? A. Existing partners B. The partnership C. New investor D. All of the above

D

It is a construction contract in which the contractor agrees to a fixed contract price, or a fixed rate per unit of output, which in some cases is subject to cost escalation clauses. a. Variable contract b. Fixed price contract c. Cost plus contract d. Mixed contract

Fixed price contract

Step 1 of the PFRS 15 five-step model requires the contract with the customer to be identified. PFRS 15 is applied only if contract has specific attributes. Which one of the following contracts of PFRS is NOT applied? a. A contract to deliver goods to a customer that entitles the customer to return the goods in exchange for a full refund b. A contract with a customer that operates in a region that is suffering severe economic recession meaning that at the inception of the contract., only 90 percent of the contract price is expected to be received from the customer. c. A contract to receive payment from a corporate customer to invest in continued research and development. Exactly how the money is spent is at the discretion of the recipient d. An oral contract with a customer to deliver goods at a specified price with payment on delivery.

A contract to receive payment from a corporate customer to invest in continued research and development. Exactly how the money is spent is at the discretion of the recipient

ACER Company enters into a contract on September 1, 20x5 to conduct computer marketing activities on behalf of a customer. The contract has a price of P8,000 and requires ACER Company to contract 10,000 households over a period of six months in order to enquire about buying habits and promote its customer. The customer is invoiced equal amounts three months and six months after the commencement of the contract. By ACER Company's year-end of December 31, 20x5, it has contacted 3,500 of the 10,000 customers. What amount does ACER Company recognize in its financial statements in the year ended December 31, 20x5? a. A revenue of P4,000 and a contract liability pf P4,000 b. A revenue of P4,000 and a receivable of P4,000 c. A revenue of P2,800 and a receivable of P4,000 and a contract liability of P1,200 d. A revenue of P2,800 and a receivable of P4,000 and a contract asset of P1,200

A revenue of P2,800 and a receivable of P4,000 and a contract asset of P1,200

Changes in partnership ownership are presumed to be arm's length transactions that may require which of the following actions? a. Revaluation of existing partnership assets b. Recognition of goodwill or other intangible assets attributable to the incoming partner c. Recognitions of goodwill to existing partners d. All of the above are possible.

All of the above are possible.

Which of the following is not a forecasted transaction that could be hedged to prevent a loss on the transaction(s) as proposed to the potential loss of forecasted transaction a. A foreign subsidiaries budgeted dividends remittance b. A domestic company's budgeted export revenues? c. An expected decrease in domestic export sales if the dollar strengthens d. A foreign subsidiary's budgeted revenues

An expected decrease in domestic export sales if the dollar strengthens

Statement 1: The dissolution of a partnership occurs only when the partnership is terminating operations and going out of business. Statement 2: One reason a change in the number of partners in a partnership through the addition or withdrawal of a partner is important because the partners have unlimited liability.

B

Company ABCD purchase goods in a currency other than its functional currency on December 1, 2014. The transaction resulted in a payable fixed in terms of the amount of foreign currency, and was paid on the settlement date, January 10, 2015. Exchange rates moved unfavorably at December 31, 2014 resulting in a loss that should: a. Be included as a separate component of stockholder's equity at December 31, 2014. b. Be included as a component of income from continuing operations for 2014. c. Be included as a deferred charge at December 31, 2014 d. Not be reported until January 10, 2015, the settlement date.

Be included as a component of income from continuing operations for 2014.

A partnership agreement calls for allocation of profits and losses by salary allocations, a bonus allocation, interest on capital, with any remainder to be allocated by present ratios. If a partnership has a loss to allocate, generally which of the following procedures would be applied? A. Any loss would allocated equally to all partners B. Any salary allocation criteria would not be used C. The bonus criteria would not be used D. The loss would be allocated using the profit and loss ratios, only.

C

IFRS 15 provides that initial franchise fee shall be recognized as revenue over time (percentage of completion method) if any one of the following criteria provided below is met. Which of the following indicator shows that the initial franchise fee shall be recognized as revenue at a point in time instead over time? a. When the franchisee has legal title to the franchise and has the significant risks and rewards of ownership of the franchise. b. When the franchisor's performance does not create and asset with alternative use to the franchisor and the franchisor has an enforceable right to payment for performance completed to date. c. When the franchisor's performance creates or enhances an asset that the franchisee controls as the asset is created or enhanced. d. When the franchisee simultaneously receives and consumes the benefits provided by the franchisor's performance as the franchisor performs Your answer is correct. The correct answer is: When the franchisee has legal title to the franchise and has the significant risks and rewards of ownership of th

When the franchisee has legal title to the franchise and has the significant risks and rewards of ownership of the franchise.

Under IFRS 15, how shall revenue from contracts with customers such as revenue from initial franchise fee be recognized by the franchisor? a. When the franchisor satisfies the performance obligation under the franchise agreement b. Applying the legality over the substance of the transaction c. Upon signing of the franchise agreement. d. Upon receipt of the initial franchise fee by the franchisor

When the franchisor satisfies the performance obligation under the franchise agreement

Step 1 of the PFRS 15 five-step model requires the contract with the customer to be identified. PFRS 15 is applied only if contract has specific attributes. Which one of the following contracts of PFRS is NOT applied? a. A contract to receive payment from a corporate customer to invest in continued research and development. Exactly how the money is spent is at the discretion of the recipient b. An oral contract with a customer to deliver goods at a specified price with payment on delivery. c. A contract with a customer that operates in a region that is suffering severe economic recession meaning that at the inception of the contract., only 90 percent of the contract price is expected to be received from the customer. d. A contract to deliver goods to a customer that entitles the customer to return the goods in exchange for a full refund

a. A contract to receive payment from a corporate customer to invest in continued research and development. Exactly how the money is spent is at the discretion of the recipient

A bonus recognized by a new partner at the date of admission into the partnership is generally shared by the existing partner's in what way? a. In proportion to capital account balances b. In proportion to profit and loss residual ratios c. Equally d. In proportion to salaries.

b. In proportion to profit and loss residual ratios

The last step in the process for revenue recognition is to a. Determine the transaction price b. Recognize revenue when each performance obligation is satisfied c. Allocate the transaction price to the separate performance obligations d. Identify the contract with customers

b. Recognize revenue when each performance obligation is satisfied

Reklamador Company sells photocopying equipment, has prepared its draft financial statements for the year ended September 30, 20x4. It has included the following transactions in revenue at stated amount. Which of these has been correctly included in revenue according to PFRS 15 Revenue from Contracts with Customers? a. Sales proceeds of P20,000 for motor vehicles which were no longer required by Reklamador b. Sales of P150,000 on September 30, 20x1. The amount invoiced to and received from the customer was P180,000, which includes P30,000 for ongoing servicing work to be done by Reklamador over the next two years. c. Agency sales P250,000 on which Reklamador is entitled to a commission. d. Sales of P200,000 on October 1, 20x3 to an established customer which with the agreement of Reklamador will be paid in full on September 30, 20x5. Reklamador has cost of capital 10%.

b. Sales of P150,000 on September 30, 20x1. The amount invoiced to and received from the customer was P180,000, which includes P30,000 for ongoing servicing work to be done by Reklamador over the next two years.

Changes in partnership ownership are presumed to be arm's length transactions that may require which of the following actions? a. Recognition of goodwill or other intangible assets attributable to the incoming partner b. Recognitions of goodwill to existing partners c. All of the above are possible. d. Revaluation of existing partnership assets

c. All of the above are possible.

On July 31, Columbia Company contracted to have two products build by DELL Manufacturing for a total of P185,000. The contract specifies that payment will only occur after both products have been transferred to Columbia Company. Columbia determines that the standalone prices are P100,000 for Product 1 and P85,000 for Product 2. On August 1, when Product 1 has been transferred, the journal entry to record this event include a: a. Debit to Contract Assets for P85,000 b. Debit to Accounts Receivable for P100,000 c. Debit to Contract Assets for P100,000 d. Debit to Accounts Receivable for P85,000

c. Debit to Contract Assets for P100,000

Concerning Foreign Exchange Forwards, which of the following statements is false? a. They require the buyer of a foreign currency to take delivery of a foreign currency b. They result in a two-sided hedge if used for hedging c. Their use automatically results in the used of hedge accounting in hedging transactions d. They can be used for hedging as well as speculating

c. Their use automatically results in the used of hedge accounting in hedging transactions

On November 1, 2013, SMART Corporation sold merchandise to DITO Corporation, a foreign firm. SMART measured and recorded the account receivable from the sale at P78,000. DITO paid for the accounts on November 30, 2013. Spot rates for FCU on November 1 and November 30 respectively, were P0.80 and P0.78. if the sale of the merchandise was denominated in FCU, the November 30 entry to record the receipt of payment from DITO Tell include a: a. Debit to Cash for P78,000 b. Credit to Exchange Gain for P1,950 c. Credit to Accounts Receivable for P76,050 d. Debit to exchange Loss for P1,950

d. Debit to exchange Loss for P1,950

It is a construction contract in which the contractor agrees to a fixed contract price, or a fixed rate per unit of output, which in some cases is subject to cost escalation clauses. a. Variable contract b. Mixed contract c. Cost plus contract d. Fixed price contract

d. Fixed price contract

Which of the following is not true about accounting for revenue from franchise arrangements? a. Franchise arrangements often include a performance obligation for a license as well as for delivery of goods and services. b. Franchise arrangements typically include one or more performance obligations for which revenue is recognized at a point in time. c. Franchise arrangements typically include one or more performance obligations for which revenue is recognized over a period of time? d. Franchise arrangements typically include one performance

d. Franchise arrangements typically include one performance

In the liquidation of a limited partnership, a loan payable by the partnership is: a. Paid immediately after all outside creditors have been paid partially b. Liabilities still to be sold c. Considered to be a liability of the partnership d. Paid immediately after all outside creditors have been paid in full

d. Paid immediately after all outside creditors have been paid in full

Which item is not shown on the schedule of partnership liquidation? a. Property owned by the partnership b. Liabilities still to be paid c. Current cash balances d. Personal assets of the partners

d. Personal assets of the partners

Which of the following is not a criterion for recognizing a bonus to a new partner when the new partner joins the partnership? A. Only cash assets were contributed to the partnership by the new partner B. The existing partners desire to not recognize goodwill on the balance sheet C. The articles of partnership indicate that the bonus method will be used to admit new partners D. The new partner invests less into the partnership that his /her share of total partnership capital after the investment is made

er: A