Thursday 28 April 2016

Cima F1 Exam Question No 49

Question No 49:

YZ, incorporated in Country X, purchased a non-depreciable asset for $45,000 on 1 January 2005. YZ incurred additional purchase costs of $5,000.
The asset was eventually sold for $110,000 on 31 December 2013. The indexation factor from 1 January 2005 to 31 December 2013 was 35%.
The capital gains tax that YZ is due to pay on the disposal of the asset is:

A.
$10,625
B.
$16,250
C.
$42,500
D.
$60,000

Answer: B

Thursday 21 April 2016

Cima F1 Exam Question No 48

Question No 48:

SB operates in Country X and is considering starting business activities in a foreign country. An entity may conduct a foreign operation through a branch or a subsidiary.
Which ONE of the following is an advantage of SB operating its foreign operation as a subsidiary?

A.
A loss made by the foreign operation will be available to the SB group.
B.
SB will only pay tax on dividends received from its foreign operation.
C.
All profits/losses overseas will be subject to tax in Country X.
D.
SB can claim tax depreciation on its foreign operation’s assets.

Answer: B

Thursday 14 April 2016

Cima F1 Exam Question No 47

Question No 47:

Which of the following is the correct meaning of “rollover relief”?

A.
A trading loss can be carried forward and used to reduce tax in a future profitable year.
B.
A capital loss incurred on the disposal of an asset can be carried forward to a future tax year.
C.
An entity ceasing to trade, carrying back a trading loss to set off against previous years’ profits.
D.
A gain arising from the sale of an asset is deferred provided the entity reinvests the proceeds of the sale in a replacement asset.

Answer: D

Thursday 7 April 2016

Cima F1 Exam Question No 46

Question No 46:

Under the current structure of regulatory bodies, which organisation is responsible for reviewing international reporting standards and issuing revised international reporting standards?

A.
IFRS Advisory Council
B.
IFRS Interpretations Committee
C.
International Accounting Standards Board
D.
IFRS Foundation

Answer: C