C a.

Income 'ci t'iabilitY

b. Asser d. I'.quitv
37. Accordirrg to the Conceptual Framework of Accounting,, which of the following is not a constraint of re levant
and
reliable information?
B a. 'I'imeliness c. Balance between benefit and cost
_.b. Neutrality d. Balance between qualitative characteristics
,.f0., Wttictr of tt',. fotto* ingis not necessarily rcgartled as nonprotit organizations?
B ''
a. Cooperatives .g: Country clubs
h. PartnershiPs 'd' l'abor unions
is that an entity qualilving for them should purchase, construct'
c. Covernment gi[i
d. Govemnrentappropriation
c. Statement of changes in equitY
d. Statentent of ctsh flows
which tax rates are used?
.!i-' ftnacted future tax rates
d. Past years' tax rates
long-term payable requiring a commitment to pay money at a
c. Net realizable value
d. Prescnt value of luture cash flows
Transaction costs that are directly attributable to the issuance ofnew shares should be
TA Mock Exam
THEORY of ACCOUNTS Mock CPA Board Examination (Page 3)
30. Wtrlcn glthe fbllowing statements regardirrg accounting concepts or theoly is incorrect?
Cl a. Accounting concepts are human-made
b" Accountiug concepts are components ol'accounting thcory
c. . Accounting theory has <Ieveloped primarily in response to government regulation
i: Accountin! theoiy can be defined as a coherent set of hypothetical, conceptual and pragmatic
principles.
i0. ]'hese are govemment grants whose primary condition
or otherwise acquire long-ternt assets.
A a. Grants related t0 assets
b. Grants related to income
3 i . A ma.ior objective o1'most cash control systems is to
D a. Ensure that current obligations are met
-tr. Ilnsure that excess cash does not exist
c, Eltsure that unused cash is invested
d. Hnsure the sat'eguarding of cash
32. Exchange differences arising frorn tronslatior of financial statements of a foreign entity arc
C e. Recognized directt;- in retained earnings
b. Recognized as accumulated translation adjustments in protit or loss
c. Recognized as accumulated translation adjustments in the equity section
d. Capitalized iltht: clifference:i resulted fiom severe devaluation of a currency
tlll. Which of the flnancial statement should an investor primarily use to assess the amounts, timing, and
uncertainty of
investing and financing activities of ABC C--onrpany?
a. ExpensedirnmediatelY
b.- Deducted from equitY
c. Charged to retained earnings
d. Deducted from equity, net of any related incorne tax benefit
39. l'his accounting objective emphasizes the importance of the lncorne Statement,as it is geared toward proper
income or
' performance determination