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Admission Test Financial-Accounting-Reporting Q&A - in .pdf
- Exam Code: Financial-Accounting-Reporting
- Exam Name: Certified Public Accountant (Financial Accounting & Reporting)
- Updated: Sep 10, 2026
- Q & A: 161 Questions and Answers
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- Exam Code: Financial-Accounting-Reporting
- Exam Name: Certified Public Accountant (Financial Accounting & Reporting)
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- Q & A: 161 Questions and Answers
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Admission Test Financial-Accounting-Reporting Exam Syllabus Topics:
| Section | Objectives |
|---|---|
| Assets and Liabilities Accounting | - Fixed assets and intangible assets - Liabilities and contingencies - Leases (ASC 842) - Cash, receivables, and inventory |
| Governmental and Not-for-Profit Accounting | - Governmental fund accounting - Not-for-profit financial reporting |
| Specialized Accounting Topics | - Foreign currency transactions - Pensions and post-employment benefits - Accounting changes and error corrections |
| Equity, Investments, and Business Combinations | - Bonds and debt instruments - Business combinations and consolidations - Stockholders' equity |
| Financial Statements and Transactions | - Revenue recognition (ASC 606) - Income statement and comprehensive income - Balance sheet and statement of cash flows |
| Conceptual Framework and Financial Reporting | - Disclosure requirements - FASB conceptual framework - Financial statement presentation |
Admission Test Certified Public Accountant (Financial Accounting & Reporting) Sample Questions:
Question #1
On January 2, 1993, Quo, Inc. hired Reed to be its controller. During the year, Reed, working closely with Quo's president and outside accountants, made changes in accounting policies, corrected several errors dating from 1992 and before, and instituted new accounting policies.
Quo's 1993 financial statements will be presented in comparative form with its 1992 financial statements.
This question represents one of Quo's transactions. List A represents possible clarifications of these transactions as: a change in accounting principle, a change in accounting estimate, a correction of an error in previously presented financial statements, or neither an accounting change nor an accounting error.
During 1993, Quo increased its investment in Worth, Inc. from a 10% interest, purchased in 1992, to 30%, and acquired a seat on Worth's board of directors. As a result of its increased investment, Quo changed its method of accounting for investment in Worth, Inc. from the cost method to the equity method.
List A
- A. Neither an accounting change nor an accounting error.
- B. Change in accounting principle.
- C. Change in accounting estimate.
- D. Correction of an error in previously presented financial statements.
Correct Answer: A 🗳️
Question #2
On January 2, 1993, Quo, Inc. hired Reed to be its controller. During the year, Reed, working closely with Quo's president and outside accountants, made changes in accounting policies, corrected several errors dating from 1992 and before, and instituted new accounting policies.
Quo's 1993 financial statements will be presented in comparative form with its 1992 financial statements.
This question represents one of Quo's transactions. List B represents the general accounting treatment required for these transactions. These treatments are:
* Cumulative effect approach - Include the cumulative effect of the adjustment resulting from the accounting change or error correction in the 1993 financial statements, and do not restate the 1992 financial statements.
* Retroactive or retrospective restatement approach - Restate the 1992 financial statements and adjust 1992 beginning retained earnings if the error or change affects a period prior to 1992.
* Prospective approach - Report 1993 and future financial statements on the new basis but do not restate 1992 financial statements.
Item to Be Answered
Quo manufactures heavy equipment to customer specifications on a contract basis. On the basis that it is preferable, accounting for these long-term contracts was switched from the completed-contract method to the percentage-of-completion method.
List B (Select one)
- A. Cumulative effect approach.
- B. Prospective approach.
- C. Retroactive or retrospective restatement approach.
Correct Answer: C 🗳️
Question #3
Which of the following factors determines whether an identified segment of an enterprise should be reported in the enterprise's financial statements under SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information?
I. The segment's assets constitute more than 10% of the combined assets of all operating segments.
II. The segment's liabilities constitute more than 10% of the combined liabilities of all operating segments.
- A. Neither I nor II.
- B. II only.
- C. I only.
- D. Both I and II.
Correct Answer: C 🗳️
Question #4
The following costs were incurred by Griff Co., a manufacturer, during 1992:
What amount of these costs should be reported as general and administrative expenses for 1992?
- A. $635,000
- B. $260,000
- C. $810,000
- D. $550,000
Correct Answer: B 🗳️
Question #5
According to the FASB conceptual framework, comprehensive income includes which of the following?
- A. Option C
- B. Option D
- C. Option A
- D. Option B
Correct Answer: D 🗳️
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