IFRS 1 Requires Companies Transitioning to IFRS to Prepare an Opening

question 10

Multiple Choice

IFRS 1 requires companies transitioning to IFRS to prepare an opening balance sheet at the "date of transition." Which of the following describes the date of transition?

• A) The beginning of the earliest period for which an entity presents full comparative information under IFRS.
• B) The beginning of the year for which the entity prepares its first IFRS financial statements.
• C) The last day of year in which an entity presents full comparative information under IFRS.
• D) At least ninety days before the entity presents its first IFRS financial statements.
• E) No more than 180 days before the entity presents its first IFRS financial statements.

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Definitions:

Profit

The financial gain realized when the revenue gained from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

Price-taker Firm

A firm that has no control over the market price and must accept the prevailing market price for its products.

Marginal Revenue

The extra revenue generated by the sale of an additional unit of a product or service.

Marginal Cost

The cost of producing one additional unit of a product or service.