AICPA CPA-Financial Exam - Topic 1 Question 92 Discussion

Actual exam question for AICPA's CPA-Financial exam

Question #: 92
Topic #: 1

[All CPA-Financial Questions]

Which of the following should be disclosed in a summary of significant accounting policies?

ABasis of profit recognition on long-term construction contracts.

BFuture minimum lease payments in the aggregate and for each of the five succeeding fiscal years.

CDepreciation expense.

DComposition of sales by segment.

Show Suggested Answer

Suggested Answer: B

Choice 'B' is correct. If comparative FS are issued, restate prior year's FS. If comparative FS are not issued, restate prior year-end's retained earnings account by 'adjusting' (net of tax) the opening balance of the current retained earnings statement.

by Sheridan at Jul 10, 2024, 12:49 AM

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Hana

3 months ago

I disagree, D is crucial for understanding business segments!

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Karan

3 months ago

Wait, are we really discussing D? Seems less relevant.

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Thora

3 months ago

C is a must, can't believe it's even a question!

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Josephine

4 months ago

I think B is also important for transparency.

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Dorethea

4 months ago

Definitely A should be included!

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Alise

4 months ago

The composition of sales by segment seems more like a detailed note rather than a significant accounting policy. I’m leaning towards A being the right answer.

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Charisse

4 months ago

I remember practicing a question similar to this where depreciation expense was mentioned. I think it’s usually included in the summary, but I’m not 100% certain.

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Hubert

4 months ago

I'm not entirely sure about the future minimum lease payments. I feel like that might be more related to financial statements rather than the summary of significant accounting policies.

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Leonie

5 months ago

I think the basis of profit recognition on long-term construction contracts is definitely something that should be disclosed. It seems important for understanding revenue recognition.

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Katlyn

5 months ago

Ugh, I'm struggling with this one. Accounting policy disclosures can be tricky, and I'm not totally sure which of these options are the most relevant. I'll have to think it through step-by-step.

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Michal

5 months ago

Okay, I've got this. The key is to identify which of these items would be considered a significant accounting policy that needs to be disclosed. I'm pretty confident I can narrow this down.

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Paul

5 months ago

Hmm, I'm a bit unsure about this one. The options cover a range of accounting topics, so I'll need to really focus on the specific question being asked about disclosure requirements.

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Amina

5 months ago

This seems like a straightforward accounting policy question. I'll review the options carefully and think through what types of information are typically disclosed in a summary of significant accounting policies.

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Fabiola

5 months ago

I've seen this type of question before, and I believe the answer is option B, "Increment Deployment Version". But I'll double-check to make sure.

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Renea

5 months ago

I'm a bit confused here. Should the Scrum master be gathering the details from the team members or coordinating with the product owner? I'll have to review my Scrum knowledge.

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Loreen

5 months ago

Hmm, I'm a bit unsure about this one. I know confirmation testing and regression testing are important after a defect fix, but I'm not sure which ones should be done next. I'll have to review my notes to be sure.

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Albina

5 months ago

This is a good question to test our understanding of Alibaba Cloud's monitoring services. I'm pretty confident that CloudMonitor is the right choice here, as it's the dedicated service for monitoring infrastructure utilization across Alibaba Cloud resources.

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Lynelle

9 months ago

Hey, at least they didn't ask about the secret formula for Coca-Cola. That's one accounting policy I'd keep under lock and key!

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Bernardo

9 months ago

D? Really? Segment information is interesting, but not as crucial as the other options.

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Ellsworth

8 months ago

D) Composition of sales by segment.

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Margart

8 months ago

C) Depreciation expense.

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Denny

8 months ago

B) Future minimum lease payments in the aggregate and for each of the five succeeding fiscal years.

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Shanice

9 months ago

A) Basis of profit recognition on long-term construction contracts.

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Herminia

10 months ago

I'm going with C. Depreciation expense is a key part of the financial statements.

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Dwight

8 months ago

Which of the following should be disclosed in a summary of significant accounting policies?

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Felice

9 months ago

Which of the following should be disclosed in a summary of significant accounting policies?

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Elsa

9 months ago

Which of the following should be disclosed in a summary of significant accounting policies?

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Ona

10 months ago

B sounds good to me - future minimum lease payments are important information for users to know.

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Sherita

9 months ago

Depreciation expense is also important to disclose, as it impacts the company's financial statements and profitability.

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Clorinda

9 months ago

I think it's important to disclose the basis of profit recognition on long-term construction contracts as well, to give insight into revenue recognition.

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Cecily

10 months ago

I agree, future minimum lease payments are crucial for users to understand the financial obligations of the company.

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Alfreda

10 months ago

The basis of profit recognition on long-term construction contracts seems like the most relevant disclosure here. A is the way to go!

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Kassandra

9 months ago

Composition of sales by segment can provide valuable information to stakeholders.

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Zachary

9 months ago

Depreciation expense is important to include in the summary of significant accounting policies.

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Belen

10 months ago

I think future minimum lease payments should also be disclosed to give a clear picture.

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Ashlyn

10 months ago

I agree, the basis of profit recognition on long-term construction contracts is crucial.

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Lanie

10 months ago

I think D should be disclosed too, to provide transparency on sales composition.

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Leota

10 months ago

I agree with Johana. B should also be disclosed to show future financial obligations.

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Johana

11 months ago

I think A should be disclosed because it affects the recognition of profit.

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