Welcome to your International Navodaya Chamber of Commerce (INCOC) Platform ! Subject: Financial ReportingTotal Number of Question: 40Time: 41 MinutesPlease check your email after completion of test for result.All the best... Name Phone No Email State 1. Derecognition of a financial liability occurs when: The liability is transferred The liability is extinguished The terms of the liability change significantly Both B and C None 2. A government grant that requires repayment is recognized as: Revenue Deferred liability A contingent liability None of the above None 3. Government grants related to assets are: Presented as deferred income or reduced from the asset Directly credited to retained earnings Expensed immediately None of the above None 4. Ind AS 20 applies to: Government grants and disclosure of government assistance Provisions Taxes Revenue recognition None 5. Biological assets under Ind AS 41 are measured at: Fair value less costs to sell Cost model Market price Historical cost None 6. Segment reporting under Ind AS 108 is applicable to: All companies Companies with listed equity or debt Private companies None of the above None 7. Fair value under Ind AS 113 is measured using: Cost model Market approach, income approach, or cost approach Historical cost None of the above None 8. The principal market for an asset is: The market with the highest transaction volume The market with the most advantageous prices The closest geographical market None of the above None 9. Agriculture produce harvested from biological assets is: Measured at fair value less costs to sell at the point of harvest Recognized as inventory at cost Ignored until sold None of the above None 10. The primary users of financial statements include: Investors, lenders, and other creditors Employees and management Government agencies only None of the above None 11. The term “prudence” in financial reporting means: Avoidance of all risks Overstating liabilities and understating assets Exercise of caution in estimates under uncertainty Using optimistic forecasts None 12. Materiality depends on: The nature and size of the item Standard thresholds Management discretion only None of the above None 13. Non-controlling interest in a subsidiary is: Reported as a liability Reported as equity Eliminated during consolidation None of the above None 14. Goodwill arising in a consolidated balance sheet is shown as: A financial asset A separate intangible asset Part of retained earnings None of the above None 15. A subsidiary is excluded from consolidation when: Control is temporary The subsidiary is undergoing liquidation Both A and B None of the above None 16. A financial asset is classified under amortized cost if: The asset is held to collect contractual cash flows The cash flows are solely payments of principal and interest Both A and B Neither A nor B None 17. The effective interest rate method is used for: Calculating amortized cost Recognizing fair value Hedging accounting All of the above None 18. Ind AS 109 requires financial liabilities to be classified as: Measured at amortized cost Measured at fair value through profit or loss Both A and B None of the above None 19. Revaluation of PPE leads to: Changes in depreciation for future periods Adjustments to past profits Changes in the cost model None of the above None 20. Depreciation method should be: Consistent with the pattern of economic benefits Based solely on management discretion Adjusted annually None of the above None 21. If an asset’s useful life changes, the depreciation expense: Is adjusted retrospectively Is recalculated prospectively Remains unchanged None of the above None 22. An intangible asset with an indefinite useful life: Is not amortized but tested for impairment annually Is amortized over 20 years Is written off immediately None of the above None 23. Internally generated goodwill: Is recognized as an asset Is never recognized as an asset Is amortized over time None of the above None 24. Development costs are capitalized when: The project is completed The entity can demonstrate technical feasibility and future benefits The costs are incurred None of the above None 25. In case of variable consideration, revenue is recognized when: Payment is received The outcome is reasonably estimable Performance obligations are satisfied None of the above None 26. The incremental costs of obtaining a contract are: Expensed immediately Capitalized if expected to be recovered Deducted from revenue None of the above None 27. In a finance lease, the lessor recognizes: The leased asset as a receivable Depreciation on the leased asset Both A and B None of the above None 28. For a lessee, lease liability includes: Fixed lease payments Variable lease payments dependent on indices Residual value guarantees All of the above None 29. Recoverable amount is the higher of: Net realizable value and fair value Value in use and fair value less costs to sell Historical cost and carrying amount None of the above None 30. An impairment loss is recognized when: Carrying amount exceeds recoverable amount Carrying amount is below historical cost Market value decreases temporarily None of the above None 31. Deferred tax is not recognized for: Temporary differences from goodwill Initial recognition of assets and liabilities that do not affect taxable income Both A and B None of the above None 32. Taxable temporary differences give rise to: Deferred tax asset Deferred tax liabilities Permanent differences None of the above None 33. Deferred tax assets are recognized to the extent that: It is probable future taxable profits will be available Temporary differences are permanent There is a history of consistent tax losses None of the above None 34. Grants related to income are recognized as income: Over the periods matching related costs Immediately upon receipt At the end of the grant term None of the above None 35. Government grants contingent upon specific conditions are: Recognized immediately Recognized only when conditions are fulfilled Credited to revaluation reserve None of the above None 36. Reportable segments are determined based on: Revenue thresholds only Operating segments that meet quantitative thresholds Internal managerial reports Both B and C None 37. Operating segments are identified based on: Geographical location only Management’s reporting structure Industry type Customer profile None 38. Items are classified as current liabilities if: Settlement is due within 12 months The entity does not have an unconditional right to defer settlement beyond 12 months Both A and B None of the above None 39. Cash and cash equivalents include: Bank overdrafts that form an integral part of cash management Equity investments Restricted bank deposits None of the above None 40. Changes in accounting policies are applied: Retrospectively unless impracticable Prospectively from the current period Only to the future financial statements None of the above None 1 out of 4 Great job on taking the INCOC Test! 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