NEWEST AICPA FAR EXAM OVERVIEW ARE LEADING MATERIALS & COMPLETE TEST FAR PRACTICE

Newest AICPA FAR Exam Overview Are Leading Materials & Complete Test FAR Practice

Newest AICPA FAR Exam Overview Are Leading Materials & Complete Test FAR Practice

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Tags: FAR Exam Overview, Test FAR Practice, FAR Exam Dumps Pdf, Test FAR Cram, Test FAR Vce Free

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Who should take the Financial Accounting and Reporting (FAR) Exam

Candidates must see the FAR exam dumps pdf to see if they are interested in the contents. People who wish to become Financial Accounting and Reporting experts and explore the dynamic culture of this field to jump-start their certification and lifelong learning goals should take this exam. Many businesses prefer that their accountants are Financial Accounting and Reporting (FAR) certified. Applicants winning their FAR title will find themselves more hirable and will be better paid. To become eligible for the exam, a candidate must have completed a 120 program approved by NYSED. Also, they must have completed their bachelor's degree with accounting as their major.

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AICPA CPA Financial Accounting and Reporting Sample Questions (Q140-Q145):

NEW QUESTION # 140
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.
Item to Be Answered
Quo sells extended service contracts on its products. Because related services are performed over
several years, in 1993 Quo changed from the cash method to the accrual method of recognizing income
from these service contracts.
List A (Select one)

  • A. Change in accounting principal.
  • B. Neither an accounting change nor an accounting error.
  • C. Change in accounting estimate.
  • D. Correction of an error in previously presented financial statements.

Answer: D

Explanation:
Choice "c" is correct. Change from the cash method to the accrual method is a correction of an error in
previously presented financial statements.


NEW QUESTION # 141
During 1990, Fuqua Steel Co. had the following unusual financial events occur:
. Bonds payable were retired five years before their scheduled maturity, resulting in a $260,000 gain.
Fuqua has frequently retired bonds early when interest rates declined significantly.
. A steel forming segment suffered $255,000 in losses due to hurricane damage. This was the fourth
similar loss sustained in a 5-year period at that location.
. A component of Fuqua's operations, steel transportation, was sold at a net loss of $350,000.
This was Fuqua's first divestiture of one of its operating segments.
Before income taxes, what amount of gain (loss) should be reported separately as a component of
income from continuing operations in 1990?

  • A. $260,000
  • B. $(350,000)
  • C. $5,000
  • D. $(255,000)

Answer: C

Explanation:
Choice "b" is correct. $5,000.
The steel forming segment's hurricane damage (4th in 5 years) of $255,000 is only "unusual in nature"
and does not occur infrequently, therefore, it is not an "extraordinary item," and should be reported
separately as a component of "income from continuing operations."
The retirement of debt, although unusual, is not infrequent for the company; therefore, the gain does not
qualify for classification as an extraordinary item per APBO No. 30 (and SFAS No. 145).


NEW QUESTION # 142
In April 30, 20X4, Deer Corp. approved a plan to dispose of a component of its business. For the period
January 1 through April 30, 20X4, the component had revenues of $500,000 and expenses of $800,000.
The assets of the component were sold on October 15, 20X4 at a loss. In its income statement for the
year ended December 31, 20X4, how should Deer report the component's operations from January 1 to
April 30, 20X4?

  • A. $300,000 should be reported as an extraordinary loss.
  • B. $500,000 and $800,000 should be included with revenues and expenses, respectively, as part of
    continuing operations.
  • C. $300,000 should be reported as part of the loss on disposal of a component and included as part of
    continuing operations.
  • D. $300,000 should be reported as a loss from operations of a component and included in loss from
    discontinued operations.

Answer: D

Explanation:
Choice "d" is correct. Once the decision has been made to dispose of a component of a business and that
component meets the criteria to be classified as held for sale, the operating results of the component for
the period reported on, and any gain or loss from the disposal, should be reported separately from
continuing operations, net of tax. In this question, the component was classified as held for sale and was
sold in the same year.
Thus, in 20X4, the results of operations, the $300,000 ($500,000-$800,000) loss, are reported as a loss
from discontinued operations. The loss on disposal would be reported as part of that loss from
discontinued operations also.
Choice "a" is incorrect. The results of operations prior to the decision date, and also after the decision
date, are reported separately from the results of continuing operations as a part of discontinued
operations. Choice "b" is incorrect. The results of operations prior to the decision date, and also after the
decision date, are reported separately from the results of continuing operations as a loss from operations
of a component and included in loss from discontinued operations.
Choice "c" is incorrect. The results of discontinued operations are not reported as an extraordinary item.


NEW QUESTION # 143
For interim financial reporting, the computation of a company's second quarter provision for income taxes
uses an effective tax rate expected to be applicable for the full fiscal year. The effective tax rate should
reflect anticipated:

  • A. Option A
  • B. Option B
  • C. Option D
  • D. Option C

Answer: C

Explanation:
Choice "d" is correct. Yes - Yes.
The effective income tax rates for operations for the full year should reflect anticipated foreign tax rates
and available tax planning alternatives. In addition, the effect of other anticipated tax credits, capital gains
rates, and foreign tax credits should be included.


NEW QUESTION # 144
Which of the following should be reported as a prior period adjustment?

  • A. Option D
  • B. Option B
  • C. Option A
  • D. Option C

Answer: B

Explanation:
Choice "b" is correct. No - Yes Change in estimated lives of depreciable assets is a "change in estimate."
They affect only current and future periods (not "prior periods," not retained earnings). Change from
unaccepted principle to accepted principle is an example of an error of a prior period that should be
reported as a "prior period adjustment."


NEW QUESTION # 145
......

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