CIMAPRO19-F02-1-ENG Practice Online

Question 1

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 : Acurrent 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.

Answer: A,B

Question 2

MS Group's total profit for period on their consolidated income statement is 31,000. This includes adjusting for their share of joint venture JV2. Calculate the share of joint venture MS Group received based on the following information.

MS operating profit 41,000

Dividend from JV2 5,000

Finance cost 3,000

Tax 11,000

A : 4,000

B : 9,000

C : 1,000

D : 7,000

E : 6,000

F : 5,000

Answer: A

Question 3

Information from the financial statements of an entity for the year to 31 December 20X5:

The gearing ratio calculated as debt/equity and interest cover are:

A : gearing of 15% andinterest cover of 6.

B : gearing of 16% and interest cover of 6.

C : gearing of 15% and interest cover of 4.

D : gearing of 16% and interest cover of 4.

Answer: A

Question 4

On 30 November 20X9 OPQ acquires a financial asset that is classified as Available for Sale.

Which of the following describes the value of the financial asset on the date ofacquisition?

A : Fair value excluding transaction costs.

B : Fair value including transaction costs.

C : Present value including transaction costs.

D : Present value excluding transaction costs.

Answer: B

Question 5

RST sells computer equipment and prepares its financial statements to 31 December.

On 30 September 20X5 RST soldcomputer software along with a two year maintenance package to a customer. The customer is given the right to return the goods within six months and claim a full refund if they are not satisfied with the computer software. The risk of return is considered to be insignificant for RST.

How should the revenue from this transaction and the right of return be recognised in thefinancial statements for the year ended 31 December 20X5?

A : Recognise 100% of the revenue from both the sale of goods and the maintenance contract and create aprovision for the anticipated level of returns.

B : Do not recognise any revenue from the sale of goods or the maintenance contract and do not create aprovision for the anticipated level of returns.

C : Recognise 12.5% of the revenue from both the sale of goods and the maintenance contract and do not create aprovision for the anticipated level of returns.

D : Recognise 100% of the revenue from the sale of goods,12.5% of the revenue from the maintenance contract and create aprovision for the anticipated level of returns.

Answer: D

Name:	F2 Advanced Financial Reporting
Exam Code:	CIMAPRO19-F02-1-ENG
Certification:	CIMA Professional Qualification
Vendor:	CIMA
Total Questions:	270
Last Updated:	May 13, 2024

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