Accounting Standards (IFRS, GAAP) Questions and Answers | Online Quiz for Practice

46. What is the difference between depreciation and amortization?

1. Depreciation is the systematic allocation of the cost of a tangible asset over its useful life, while amortization is the systematic allocation of the cost of an intangible asset over its useful life
2. Depreciation is the decrease in the market value of an asset, while amortization is the increase in the market value of an asset
3. Depreciation is applicable to tangible assets, while amortization is applicable to intangible assets
4. Depreciation is a non-cash expense, while amortization is a cash expense

47. What is impairment?

1. A loss in the value of an asset below its carrying amount
2. The decrease in the market value of an asset
3. The increase in the market value of an asset
4. The cost of repairing or maintaining an asset

48. What are the key financial statements?

1. Income statement, balance sheet, statement of cash flows, statement of changes in equity
2. Income statement, balance sheet, statement of retained earnings, statement of comprehensive income
3. Income statement, balance sheet, statement of cash flows, statement of comprehensive income
4. Income statement, balance sheet, statement of cash flows, statement of financial position

49. What information does the income statement provide?

1. A company's financial position at a point in time
2. A company's revenues and expenses over a period of time
3. A company's cash flows over a period of time
4. A company's changes in equity over a period of time

50. What information does the balance sheet provide?

1. A company's financial position at a point in time
2. A company's revenues and expenses over a period of time
3. A company's cash flows over a period of time
4. A company's changes in equity over a period of time

51. What information does the statement of cash flows provide?

1. A company's cash flows over a period of time
2. A company's revenues and expenses over a period of time
3. A company's financial position at a point in time
4. A company's changes in equity over a period of time

52. What information does the statement of changes in equity provide?

1. The changes in a company's equity over a period of time
2. A company's revenues and expenses over a period of time
3. A company's cash flows over a period of time
4. A company's financial position at a point in time

53. What organization is responsible for issuing IFRS?

1. International Accounting Standards Board (IASB)
2. Financial Accounting Standards Board (FASB)
3. Securities and Exchange Commission 1 (SEC)
4. International Monetary Fund (IMF)

54. What organization is responsible for issuing GAAP in the US?

1. International Accounting Standards Board (IASB)
2. Financial Accounting Standards Board (FASB)
3. Securities and Exchange Commission 2 (SEC)
4. International Monetary Fund (IMF)

55. How do IFRS and GAAP differ?

1. In their specific rules and interpretations for certain accounting transactions
2. In their overall objectives
3. In their legal enforceability
4. In their use of accrual accounting

56. What is the convergence project?

1. An effort to reduce the differences between IFRS and GAAP
2. A project to develop a single set of global accounting standards
3. A project to improve the quality of financial reporting
4. A project to increase the use of IFRS worldwide