B.Com Corporate Accounting Quiz & Flashcards

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Questions and Answers

How are intangible assets described in the study material?

Visible and valuable

Easily quantifiable

Cannot be seen or touched but have value (correct)

Not considered in accounting standards

What is the main focus of Module-I in the study material?

Inventory accounting standards (correct)

Tangible asset classification

Intangible asset valuation

Accounting standards for property, plant, and equipment

What is the primary focus of Module-II in the study material?

Investment accounting

Financial reporting of intangible assets

Taxation standards

Valuation of goodwill (correct)

Which accounting standards are covered in the study material for property, plant, and equipment?

Ind AS 16 & IAS 16 Signup and view all the answers

What type of assets cannot be seen and touched but still hold value?

Intangible assets Signup and view all the answers

Which chapter in the study material focuses on property, plant, and equipment accounting standards?

Module-III Signup and view all the answers

What does the matching concept prescribe for inventories?

They should be accounted for as an expense when sold Signup and view all the answers

Which of the following is considered an intangible asset?

Goodwill Signup and view all the answers

What is the objective of the standard on accounting for inventories?

To prescribe the accounting treatment for inventories Signup and view all the answers

Under which category are work in progress under a construction contract excluded from the scope of inventory accounting?

Construction contracts Signup and view all the answers

What does the term 'net realizable value' refer to?

The estimated selling price minus the cost of completion and the estimated costs necessary to make the sale Signup and view all the answers

What does the cost of inventories comprise of?

Purchase price, import duties, and handling cost Signup and view all the answers

Which component must inventories be measured at, according to the standards?

$ ext{Cost or net realizable value, whichever is less}$ Signup and view all the answers

What are examples of inventories?

Finished goods and work in progress Signup and view all the answers

What does 'materials to be used in the production process' refer to?

$ ext{Raw materials}$ Signup and view all the answers

In what circumstances should inventories be accounted for as an expense?

At the time they are sold. Signup and view all the answers

Study Notes

Intangible Assets

Intangible assets are non-physical assets that hold value, such as patents, trademarks, and copyrights.

Module-I Focus

Focuses on foundational concepts of financial accounting and the understanding of financial statements.

Module-II Focus

Concentrates on advanced accounting topics, including specific accounting standards and practices.

Accounting Standards for Property, Plant, and Equipment

Covers applicable international standards such as IAS 16 or relevant national standards that dictate the recognition and measurement of property, plant, and equipment.

Types of Intangible Assets

Assets that cannot be seen or touched but still hold significant value are categorized as intangible assets, like intellectual property and goodwill.

Chapter on Property, Plant, and Equipment

A specific chapter outlines the accounting standards for property, plant, and equipment, detailing recognition, quantification, and depreciation.

Matching Concept for Inventories

Prescribes that expenses associated with inventory should be recognized in the same period as the revenues that are generated from the sale of those inventories.

Examples of Intangible Assets

Considerations include franchises, software, and research and development costs.

Objective of Inventory Accounting Standards

Aims to outline the procedures for measuring and reporting the value of inventories to reflect their fair value in financial statements.

Work in Progress Exclusion

Work in progress under a construction contract is excluded from inventory accounting standards, recognizing it separately for specific project accounting.

Net Realizable Value

Refers to the estimated selling price in the ordinary course of business minus any expected costs of completion and disposal.

Cost of Inventories Components

Comprises all costs of purchase, conversion, and other costs incurred to bring the inventories to their present location and condition.

Measurement of Inventories

According to standards, inventories must be measured at the lower of cost and net realizable value.

Inventory Examples

Typical examples of inventories include raw materials, work in progress, and finished goods.

Materials in Production Process

Refers to raw materials that are intended for use in manufacturing or production activities within a business.

Accounting for Inventories as Expense

Inventories should be accounted for as an expense when they are sold or when they are otherwise written down due to obsolescence or damage.

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Description

Access study material for the Corporate Accounting course (BC3B04) offered by the University of Calicut, School of Distance Education. This study material is designed for B.Com students enrolled from the 2017 admission onwards.

Corporate Accounting Study Material for B.Com Third Semester

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