Practice Financial-Accounting-and-Reporting Exam Online

Question 1

In the context of a regulatory framework, a principles-based system

A : is a rule-driven approach.

B : attempts to cover specific eventualities.

C : provides a theoretical basis with broad terms of reference.

D : removes any element of judgement by providing clear requirements.

Answer: C

Question 2

Restrictions on the scope of a specific accounting standard are stated in

A : that specific standard.

B : the IASB's Conceptual Framework.

C : the explanatory materials provided by the AASB.

D : various Statements of Accounting Concepts (SACs) issued by the AASB.

Answer: A

Question 3

Liquidity of a company is based on its ability to

A : buy back shares.

B : meet long term commitments.

C : pay dividends to shareholders.

D : meet short term commitments.

Answer: D

Question 4

A company purchased a machine 10 years ago for $143 890. It is expected that the machine will generate future revenues of $108 495. The machine could be scrapped for $81 232. An equivalent machine in the same condition would cost $94 950 to buy now. What is the deprival value of the asset?

A : $35 395

B : $81 232

C : $94 950

D : $108 495

Answer: C

Question 5

Which one of the following statements regarding the IASB's Conceptual Framework for Financial Reporting is correct?

A : It overrides any local or international accounting standard.

B : It specifies the concepts that underlie the preparation and presentation of special purpose financial statements.

C : It specifies the concepts that underlie the preparation and presentation of general purpose financial statements.

D : It specifies the concepts that underlie the preparation and presentation of only consolidated financial statements.

Answer: C

Name:	CPA Financial Accounting and Reporting
Exam Code:	Financial-Accounting-and-Reporting
Certification:	CPA Australia Certification
Vendor:	CPA Australia
Total Questions:	101
Last Updated:	Oct 01, 2026

CPA Australia Financial-Accounting-and-Reporting Answers