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Which of the following statements about IAS 2 Inventories is correct?

A

Production overheads should be included in cost on the basis of a company's normal level of

activity in the period.

B

In arriving at the net realisable value of inventories, trade discounts and settlement discounts

must be deducted.

C

In arriving at the cost of inventories, FIFO, LIFO and weighted average cost formulas are

acceptable.

D

It is permitted to value finished goods inventories at materials plus labour cost only, without

adding production overheads.

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Chapter7Inventory

Trade discounts should be deducted but not settlement discounts. IAS 2 does not allow the use of LIFO.

Production overheads are part of the costs of conversion part of the valuation. of finished goods and do form

多做几道

Which accounting concept should be considered if the owner of a business takes goods from inventory for his own personal

use?

A

The fair presentation concept

B

The accruals concept

C

The going concern concept

D

The business entity concept

Which accounting concept should be considered if the owner of a business takes goods from inventory for his own personal

use?

A

The fair presentation concept

B

The accruals concept

C

The going concern concept

D

The business entity concept

According to the IASB's Conceptual Framework for Financial Reporting, which TWO of the following are part of faithful

representation?1 It is neutral2 It is relevant3 It is presented fairly4 It is free from material error

A

1 and 2

B

2 and 3

C

1 and 4

D

3 and4

Which of the following accounting concepts means that similar items should receive a similar accounting treatment?

A

Going concern

B

Accruals

C

Matching

D

Consistency

Listed below are some characteristics of financial information.1 Relevance2 Consistency3 Faithful representation4 Accuracy

Which of these are qualitative characteristics of financial information according to the IASB's Conceptual Framework for

Financial Reporting?

A

1 and 2 only

B

2 and 4 only

C

3 and 4 only

D

1 and 3 only

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