AASB 133 Applies to the Computation and Presentation of Earnings

question 14

Multiple Choice

AASB 133 applies to the computation and presentation of earnings per share by:

• A) both reporting and non-reporting entities.
• B) only reporting entities whose shares are publicly traded.
• C) only those entities that are in the process of issuing ordinary shares that will be traded in public markets.
• D) reporting entities whose shares are publicly traded, or of entities that are in the process of issuing ordinary shares that will be traded in public markets.

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Definitions:

Manufacturing

The process of converting raw materials, components, or parts into finished goods that meet a customer's expectations or specifications.

Factory Rent

Expenses incurred for leasing a premises to use as a manufacturing or production facility.

Prime Costs

The combined direct costs of raw materials and labor that are directly attributable to the production of a product.

Conversion Costs

The sum of direct labor and overhead costs involved in converting raw materials into finished goods.