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NO.1 According to the IASB's Conceptual Framework for Financial Reporting, which of the following
does an entity's income statement, statement of financial position and statement of cash flows
primarily measure?
Income statement Statement ofStatement of financial position cash flows
A. Financial adaptability Financial position Financial position
B. Financial performanceFinancial adaptability Financial position
C. Financial performanceFinancial position Financial adaptability
D. Financial position Financial performance Financial adaptability
Answer: C
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NO.2 Rochester pIc has entered into a fixed price contract for the provision of services to Adele Ltd.
The contract commenced in September 2012 and will be completed in 2013.
The contract price is $2 million and costs are recoverable as incurred. At 31 December 2012,
Rochester plc's year ends, costs of $500,000 have been incurred.
The contract has been assessed as 30% complete; however, costs to complete cannot be estimated
reliably.
In accordance with IAS 18 Revenue, how much revenue should be included in Rochester plc's
statement of comprehensive income for the year ended 31 December 2012 in respect of this
contract?
A. Nil
B. $500,000
C. $600,000
D. $2 million
Answer: B
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