Pass the CIMA Operational F1 Questions and answers with ExamsMirror

Which of the following does the phrase 'events after the reporting period' refer to?

Statements of financial position for YZ, BC and DE at 31 March 20X2 include the following balances:

YZ purchased 90% of BC's equity shares for $508,000 on 1 January 20X2. On 1 January 20X2 BC's retained earnings were $183,000. YZ uses the proportion of net assets method to value non-controlling interest at acquisition.

YZ purchased 30% of DE's equity shares on 1 April 20X1 for $112,000. DE's retained earnings at 1 April 20X1 were $88,000.

On 1 February 20X2 YZ sold goods to BC for $28,000 at a mark up of 25% on cost. All the goods were still in BC's inventory at 31 March 20X2.

Calculate the value of the investment in associate to be recognised in the consolidated statement of financial position at 31 March 20X2.

Give your answer to nearest whole $.

The development of an international financial reporting standard generally goes through a number of stages.

Which of the following is NOT a stage of development?

Which of the following is NOT a responsibility of the International Accounting Standards Board?

During the year a piece of equipment that originally cost $96,000, with accumulated depreciation of $39,000, met the criteria of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations to be classified as held for sale.

The equipment is being advertised for sale at $46,000 and costs of $1,000 will be incurred to enable the sale to be completed.

At what value should the equipment be included in the statement of financial position at the year end assuming that it remains unsold?

Give your answer to the nearest whole number.

XYZ operates in Country A where tax rules state that entertaining costs and donations to political parties are disallowable for tax purposes.

XYZ calculated both its accounting and taxable profits for the year ended 31 December 20X2 after deducting $10,000 of entertaining costs.

It is considering what impact the ruling that "entertaining costs are disallowable for tax purposes" will have on its two profit figures.

Which of the following correctly states the impact of the ruling on the profits already calculated?

Which of the following is a condition that has to be met for an entity to be exempt the requirement to prepare consolidated financial statements?

When a trading loss is incurred by an entity, the entity may be able to claim loss relief. The way in which loss relief is claimed vanes from country to country.

Which of the following is NOT normally a way of claiming loss relief for a trading loss?

An entity has a number of subsidiary and associate investments.

Which of the following must be disclosed in the entity's separate financial statements if it is exempt from presenting consolidated financial statements?

BC manufactures product X and on 1 February 20X4 started a project to develop a new material for use in its production. The development project is due to be completed by 31 December 20X4 with the new material being used in production from 1 January 20X5. The development project costs have been reliably estimated at $200,000 and it is anticipated that the new material will increase the margin achieved on product X by 20%.

You are a CIMA accountant within BC and are considering how to treat the development costs of $200,000 in the financial statements for the year ended 31 December 20X4.

In accordance with the ethical principle of professional competence and due care, which of the following statements correctly explains how these costs should be accounted for?