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An asset should be recognised in the financial statements when:an exchange has occurred.it possesses a cost or other value that can be measured...

1.An asset should be recognised in the financial statements when:

i.an exchange has occurred.

ii.it possesses a cost or other value that can be measured reliably.

iii.it is probable that the future economic benefits embodied in the asset will eventuate.

A.i and ii only

B.i and iii only

C.ii and iii only

D.i, ii and iii

ANS: C

why an exchange has occurred is not correct? Is that like a company has already hold inventory at the beginning, which is like a stock inventory for the firm without the exchange?


2.Systemic effects arise when:

A.changes result from government legislation.

B.market-wide changes in share prices come from the economic system.

C.an announcement is made regarding the future prospects of a particular company.

D.the takeover of a large public company is announced.

ANS: B

what is systemic effects? i am not sure, can u explain each choice, please?


3.Which of the following statements about agency theory is TRUE?

A.It focuses on the internal control system.

B.Conflicts of interest are regarded as unnatural.

C.It tends to focus on the future-oriented, decision-making role of accounting information.

D.It is concerned with contractual relationships among people.

ANS: D

Can u explain the option A and C, why they're incorrect?


4.Which of the following is NOT included in the corporate governance statement required under stock exchange regulations?

A.Composition of the audit committee

B.Expected changes to the top management team

C.Procedures for identifying and managing business risks

D.Statement of ethical standards

ANS: B

Can u explain each options, please?


Thanks a lot!

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