Which of the Following Statements Is True Regarding International Financial

question 68

Multiple Choice

Which of the following statements is true regarding International Financial Reporting Standards (IFRS) and U.S. GAAP?

• A) IFRS allows both the perpetual and periodic systems, but U.S GAAP permits only the perpetual system.
• B) IFRS requires a single-step income statement, but U.S. GAAP allows either the single-step or the multiple-step income statement.
• C) U.S. GAAP allows operating expenses to be reported by either function or nature, IFRS requires reporting by function.
• D) IFRS requires 2 years of income statements, U.S. GAAP requires 3 years of income statements.

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Definitions:

Standard Cost

A predetermined cost of manufacturing a single unit or a number of product units during a specific period under current or anticipated conditions.

Time Of Purchase

The specific point in time when goods or services are bought, which can influence the cost and availability.

Materials Price Variance

The difference between the actual cost of materials purchased and the expected cost of materials, adjusted for the actual quantity purchased.

Production Line

An arrangement of machines and workers in a factory where a product passes sequentially from operation to operation until completed.