Free Online CFA Level 1 Mock Exam 5

Looking for a free CFA Level 1 mock exam online? You’ve come to the right place! We offer a complimentary online CFA Level 1 mock exam designed to help you familiarize yourself with the exam format, assess your knowledge, and prepare thoroughly for the real thing. Whether you’re in the midst of studying or seeking a self-assessment, our free mock exam provides valuable practice. Start now to experience the real exam atmosphere and gauge your performance under exam conditions.

Financial Reporting and Analysis

1. In 2013, Judy’s Company had cost of goods sold of $25 million, beginning inventory of $2 million, and ending inventory of $5 million. If accounts payable increases by $3 million, cash paid to suppliers during the year will be closest to:

A. USD22 million.

B. USD25 million.

C. USD28 million.

Correct Answer: B

Answer Explanation:

Cash paid to vendors = total sales + increase in inventory – increase in accounts payable = $25 million + $3 million – $3 million = $25 million

Advertisement

2. The company wants to match the actual historical cost of inventory items with their physical flows, and the inventory valuation method that is most likely to accomplish this goal is:

A. FIFO.

B. LIFO.

C. specific identification.

Correct Answer: C

Answer Explanation:

Specific identification best matches the actual movement of inventory items because it tracks the actual units sold.

Advertisement

3. In a statement of cash flows prepared in accordance with U.S. GAAP, interest paid would most likely be included in which activity?

A. Operating.

B. Financing.

C. Either operating or financing.

Correct Answer: A

Answer Explanation:

Under U.S. GAAP, interest paid must be classified as an operating cash flow activity, but under IFRS it can be classified as either an operating or financing cash flow activity.

Advertisement

Leave A Comment?