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Identify the rule, formula, or decision criterion before reading the answer choices. CFA Level I distractors often use the right vocabulary with the wrong condition.
Financial Statement Analysis
Analysis of Long-Term Assets practice questions
Analysis of Long-Term Assets is part of CFA Level I Financial Statement Analysis. Financial Statement Analysis questions require careful reading of accounting choices, ratios, cash flow classification, inventories, taxes, leases, and reporting quality. Use this page to review the controlling ideas, then work through 10 questions with answer explanations and common traps.
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Financial Statement Analysis
Analysis of Long-Term Assets
Under the IFRS revaluation model, a first-time upward revaluation of a machine above its depreciated historical cost is most likely recognized in:
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Analysis of Long-Term Assets
Fatima Zahra reviews a company that uses straight-line depreciation with negligible residual values. Gross PP&E is $800 million, accumulated depreciation is $240 million, and annual depreciation expense is $80 million. The average age of the company's assets is closest to:
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Analysis of Long-Term Assets
A machine has a carrying amount of $500. Expected future undiscounted cash flows are $520, fair value less costs of disposal is $430, and value in use is $460. The impairment loss recognized under US GAAP and under IFRS, respectively, is closest to:
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Analysis of Long-Term Assets
Straight-line depreciation expense is calculated as:
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Analysis of Long-Term Assets
A machine costs 500, has residual value of 50, and useful life of 5 years. Annual straight-line depreciation is closest to:
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Analysis of Long-Term Assets
A machine has a carrying amount of 120 and is sold for 95. The income statement effect is most likely:
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Analysis of Long-Term Assets
Under IFRS, research costs for an internally generated intangible asset are generally:
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Analysis of Long-Term Assets
Under IFRS, an impaired asset with carrying amount of 300 has fair value less costs of disposal of 240 and value in use of 260. Impairment loss is closest to:
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Analysis of Long-Term Assets
Compared with expensing a qualifying cost immediately, capitalizing the cost will most likely cause current-period CFO and CFI to be:
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Analysis of Long-Term Assets
Goodwill acquired in a business combination is most likely:
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