CIMA CIMA-F1 Online Practice Questions and Exam Preparation

CIMA CIMA-F1 Online Questions & Answers

• Question 151:

  Which of the following is a feature of a direct tax?

  A. The formal incidence and effective incidence are usually the same.
  B. It is levied on one part of the economy with the intention that it will be passed on to another.
  C. It is not levied on the eventual payer of the tax.
  D. It cannot be related to the individual circumstances of the tax payer.
  A. The formal incidence and effective incidence are usually the same.

• Question 152:

  FILL IN THE BLANK

  Statements of financial position for FG, IJ and KL at 31 December 20X5 include the following balances:

  

  FG acquired 90% of IJ's equity shares for $358,000 on 1 July 20X5 when IJ's retained earnings were $98,000.

  FG acquired 100% of KL's equity shares for $360,000 on 1 January 20X5 when KL's retained earnings were $155,000.

  FG used the proportion of net assets method to value non-controlling interests at acquisition.

  KL sold a piece of land to FG for $130,000 on 1 September 20X5. At the date of transfer the land had a carrying value of $50,000.

  The management of FG expect KL to make profits in the future and no impairment ot its goodwill was proposed at 31 December 20X5. Calculate the amount of retained earnings that will be included in FG's consolidated statement of financial position as at 31 December 20X5. Give your answer to the nearest whole $.

  $709200

• Question 153:

  HOTSPOT

  LM received notification on 10 November 20X4 from one of its customers stating they had ceased trading as they had gone into liquidation. The balance outstanding at 31 October 20X4 was $150,000.

  In accordance with IAS 10 Events after the Reporting Date this event will be treated as:

  

  

• Question 154:

  FILL IN THE BLANK

  PP supplies zero-rated and standard-rated goods. During the year ended 30 March 20X3, the standard-rated goods made up 50% of the total supplies. During the year ended 30 March 20X4 this percentage increased to 60%.

  What percentage of input tax suffered can PP claim back in the year ended 30 March 20X4?

  Give your answer as a whole number.

  100%

• Question 155:

  Which of the following is NOT an enhancing qualitative characteristic of financial information?

  A. Comparability
  B. Timeliness
  C. Verifiability
  D. Historical cost
  D. Historical cost

• Question 156:

  To apply the fundamental principles of the Code of Ethics, existing and potential threats to the entity first need to be identified and evaluated. Which THREE of the following are identified in the Code as threats?

  A. Confidentiality threat
  B. Self-interest threats
  C. Self-review threats
  D. Familiarity threats
  E. Integrity threats
  F. Objectivity threats
  B. Self-interest threats
  C. Self-review threats
  D. Familiarity threats

• Question 157:

  AB has been asked to analyze the receivables days of an entity with a view to improving the working capital cycle. The following results have been produced for receivable days:

  

  Which of the following is NOT an explanation of why the days have increased?

  A. The entity has increased turnover for year ended 31 December 20X2 by offering extended credit terms.
  B. The entity has made substantial sales to overseas entities in the last few months of the year ended 31 December 20X2.
  C. The entity has transferred all receivables collections to a factoring agency during 20X2.
  D. An inexperienced credit controller was employed in the last few months of year ended 31 December and requires substantial training.
  C. The entity has transferred all receivables collections to a factoring agency during 20X2.

• Question 158:

  FILL IN THE BLANK

  An entity has a working capital cycle of 120 days which has been calculated in part from the following data:

  

  What is the stock holding period on the basis of 365 days in a year? Give your answer to the nearest whole day.

  101 days

• Question 159:

  CDE has been offering its customers a 50-day credit period, but now wants to improve its cash flow.

  CDE is proposing to offer a 2% discount for payment in 20 days.

  Assume a 365-day year and an invoice value of $100

  Which of the following is the effective annual interest rate CDE will incur for this action?

  A. 27.9%
  B. 44.6%
  C. 15.9%
  D. 49.8%
  A. 27.9%

• Question 160:

  UV's financial statements for the year ended 31 March 20X8 were approved for publication on 30 June 20X8.

  In accordance with IAS 10 Events After the Reporting Period, which of the following material events would have been classified as a non-adjusting event in these financial statements?

  A. On 1 June 20X8 UV's auditors discovered that an error in valuation had caused the closing inventory to be overvalued by $150,000.
  B. On 10 April 20X8 UV received a communication stating that one of its customers had ceased trading and gone into liquidation. The balance outstanding at 31 March 20X8 was unlikely to be paid.
  C. On 1 June 20X8 UV was awarded damages of $70,000 in respect of a legal claim that it had made against the local government authority in October 20X7.
  D. On 28 April 20X8 a fire destroyed half of UV's main production facility. Output was severely reduced for six months.
  D. On 28 April 20X8 a fire destroyed half of UV's main production facility. Output was severely reduced for six months.