Financial Accounting Exam

Which of the following is not a major characteristic of a plant asset?

• Possesses physical substance

• Acquired for resale

• Acquired for use

• Yields services over a number of years

The cost of land does not include

• costs of grading, filling, draining, and clearing.

• costs of grading, filling, draining, and clearing.

• costs of improvements with limited lives.

• special assessments.

Historical cost is the basis advocated for recording the acquisition of property, plant, and

equipment for all of the following reasons except

• at the date of acquisition, cost reflects fair market value.

• property, plant, and equipment items are always acquired at their original historical

  cost.

• historical cost involves actual transactions and, as such, is the most reliable basis.

• gains and losses should not be anticipated but should be recognized when the asset

  is sold.

The Philippine accounting standard-setting body was established by the ____________. 

• Board of Accountancy

• International Accounting Standards Board

• President of the Philippines

• Professional Regulation Commission

It is the branch of accounting that focuses on the preparation of general purpose financial statements.

This refers to the use o  caution in the exercise o  judgments needed in making estimates required under conditions o  uncertainty, such that assets or income are not overstated and liabilities or expenses are not understated.

What is the name of the government agency in the Philippines responsible for administering, implementing, and enforcing regulatory laws on the licensing of professionals and occupations?

The personal transactions of the business owner that do not involve the business are not recorded in the books of accounts of the business. This relates to the concept of ___________.

The banking industry in the Philippines is mainly regulated by the ____________.

The cost of providing or using information should not exceed the information's usefulness.