CIMA CIMAPRA19-F02-1-ENG F2 Advanced Financial Reporting (Online) Online Training
CIMA CIMAPRA19-F02-1-ENG Online Training
The questions for CIMAPRA19-F02-1-ENG were last updated at Nov 26,2024.
- Exam Code: CIMAPRA19-F02-1-ENG
- Exam Name: F2 Advanced Financial Reporting (Online)
- Certification Provider: CIMA
- Latest update: Nov 26,2024
When accounting for a finance lease under IAS 17 Leases, which TWO of the following are recognised in the statement of profit or loss?
- A . Finance cost element of the lease payments
- B . Depreciation of the leased asset
- C . Lease payments paid
- D . Lease payments payable
- E . Capital repayment element of the lease payments
Which of the following is NOT an example of an unconsolidated structured entity as defined in IFRS12 Disclosure of Interests in Other Entities?
- A . A post-employment benefit plan
- B . A securitisation vehicle
- C . An asset-backed financing scheme
- D . An investment fund
CORRECT TEXT
LK acquired 100% of the equity shares of TU on 1 January 20X4. LK disposed of 60% of TU for £2,400,000 on 30 September 20X4. The sale proceeds reflected the fair value of TU’s shares on that date.
The remaining 40% shareholding gave LK the ability to exercise significant influence over the activities of TU. TU reported profit of $1,800,000 for the year ended 31 December 20X4 and this accrued evenly throughout the year.
Calculate the investment in associate that will be presented in LK’s consolidated statement of financial position as at 31 December 20X4.
Give your answer to the nearest whole $’000.
$ 000
Which TWO of the following are true in relation to IAS21.
The Effects of Changes in Foreign Exchange Rates when consolidating an overseas subsidiary?
- A . A current period exchange gain or loss is shown within the consolidated statement of comprehensive income within other comprehensive income.
- B . Goodwill is re-translated at the end of each reporting period and reflected at the period end exchange rate in the consolidated statement of financial position.
- C . Assets and liabilities of the subsidiary are translated at each reporting date using the average exchange rate for the period.
- D . Goodwill is reflected in the consolidated statement of financial position translated at the exchange rate on the date of acquisition.
- E . The statement of profit or loss of the subsidiary is translated for the reporting period using the closing exchange rate.
On 1 January 20X7 GH purchased plant and equipment at a cost of $400,000. The temporary differences in respect of this plant and equipment at 31 December 20X7 and 20X8 have been calculated as follows:
Assume that there are no other temporary differences in the periods and that the corporate income tax rate is 25%. GH is expected to have significant taxable profits in the future.
Which of the following is the correct impact in GH’s statement of financial position at 31 December 20X8 in respect of deferred tax?
- A . Increase in the deferred tax asset.
- B . Increase in the deferred tax liability.
- C . Decrease in the deferred tax asset.
- D . Decrease in the deferred tax liability.
XY has a weighted average cost of capital (WACC) of 10% based on its gearing level (measured as debt/debt+equity) of 40%. It is considering a signficant new project.
In which of the following situations would it be appropriate to appraise this project using XY’s existing WACC of 10%?
- A . The project is in a different industry to XY’s current operations and funded entirely by equity.
- B . The project is an extension of XY’s current operations and is funded 40% by debt and 60% by equity.
- C . The project is an extension of XY’s current operations and is funded by equal amounts of debt and equity.
- D . The project is in a different industry to XY’s current operations and is funded by equal amounts of debt and equity.
Which of the following reduce the usefulness of ratio analysis when comparing entities that operate in the same industry?Select ALL that apply.
- A . The revenue figure being aggregated from many different activities and sources.
- B . Accounting estimates in respect of depreciation being different between entities.
- C . The effect of a material and unusual item being disclosed separately in the notes.
- D . An entity adopting a policy of revaluing its non current assets.
- E . Ratio calculations being based on historical information.
- F . Ratios being quick and easy to calculate.
AB owned 80% of the equity share capital of FG at 1 January 20X6. AB disposed of 10% of FG’s equity share capital on 31 December 20X6 for $400,000. The non controlling interest was measured at $700,000 immediately prior to the disposal.
Which of the following represents the adjustment that AB made to non controlling interest in respect of the disposal when it prepared its consolidated financial statements at 31 December 20X6?
- A . Credit of $350,000
- B . Debit of $400,000
- C . Debit of $350,000
- D . Credit of $50,000
HJ is currently in dispute with an employee, who is claiming $400,000 in a legal case against them.
HJ’s legal advisors have stated that it is probable that they will lose the case and will have to pay the amount claimed.
Also, HJ are claiming $250,000 from a supplier of defective goods and the legal advisors have stated that it is probable that HJ will be successfulin this claim.
What is the correct accounting treatment for these two items in HJ’s financial statements?
- A . Provide for the $400,000 potential outflow and disclose the $250,000 potential inflow.
- B . Provide for the $400,000 potential outflow and recognise the $250,000 potential inflow.
- C . Disclose the $400,000 potential outflow and disclose the $250,000 potential inflow.
- D . Disclose the $400,000 potential outflow and recognise the $250,000 potential inflow.
Which THREE of the following statements are true in relation to financial assets designated as fair value through profit or loss under IAS 39 Financial Instruments:
Recognition and Measurement?
- A . Shares in another entity held for short term trading purposes fall within this category.
- B . Transaction costs in relation to these assets are expensed to profit or loss on acquisition.
- C . Transaction costs in relation to these assets are added to the initial cost of the asset on acquisition.
- D . The gain or loss on the subsequent measurement of these assets is recorded within other comprehensive income.
- E . The gain or loss on the subsequent measurement of these assets is recorded within profit for the year.
- F . Once the asset has been subsequently measured to fair value an impairment review is undertaken.
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