Question :   21. AASB 102 Inventories applies to the accounting for: a. work : 2102205

 

21. AASB 102 Inventories applies to the accounting for:

a. work in progress under construction contracts;

b. financial instruments;

c. biological assets;

d. materials consumed in the manufacture of knitting machines for sale.

22. When an entity’s operating cycle is not clearly identifiable it is assumed to be:

a. three months;

b. six months;

c. nine months;

d. 12 months.

23. Where inventories in an industry are measured by reference to historical cost which of the following measurement rules applies subsequent to initial measurement?

a. historical cost;

b. discounted cash flow;

c. lower of cost and net realisable value;

d. replacement cost.

24. Taxes may be included in the costs of inventory unless they are:

a. levied on the entity by a foreign government;

b. in respect to the raw materials component of manufactured inventory;

c. recoverable by the entity from the taxing authority;

d. in the nature of import duties.

25. The terms ‘2/7’ appearing on an invoice for the sale/purchase of inventory means that the buyer:

a. will receive a 2% discount if paid within 7 days of the invoice date;

b. will receive a 7% discount if paid within 2 days of the invoice date;

c. has 7 days from the invoice date to pay or will be charged a 2% surcharge;

d. has 2 days from the invoice date to pay or will be charged a 7% surcharge.