Sample CPA FAR Practice Questions

You are probably well aware that Financial Accounting and Reporting (FAR) is typically considered the hardest section because it has the lowest pass rate of the four sections that make up the Uniform CPA Exam. As a result, it is important to have a solid understanding of the material tested to ensure that you only have to take FAR one time. FAR covers a wide array of topics including Conceptual Framework, Standards, Standard Setting, and Presentation of Financial Statements; Financial Statement Accounts: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures; Specific Transactions, Events and Disclosures: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures; Governmental Accounting and Reporting; and Not-for-Profit (Nongovernmental) Accounting and Reporting. Underpreparing can lead to a big oh snap! when it comes to this four hour section. As a reminder, you will have 90 multiple choice questions (60 percent) and 7 task-based simulations (40 percent). To maximize your chance of success, it is very, very important to do well on the multiple choice questions. So let’s take a look at a few sample CPA FAR practice questions.

Sample CPA FAR Practice Questions

Conceptual Framework, Standards, Standard Setting, and Presentation of Financial Statements

Within how many days after the end of the period must a publically traded company that is a non-accelerated filer file its Form 10-Q with the Securities and Exchange Commission?

  1. 40 days.
  2. 45 days
  3. 60 days.
  4. 90 days.

Financial Statement Accounts: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures

The following inventory method of accounting is allowed under US GAAP but is not allowed under IFRS:

  1. First in first out (FIFO).
  2. Last in first out (LIFO).
  3. Moving average.
  4. Specific identification.

Specific Transactions, Events and Disclosures: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures

As of January 1, Mini Tiny Home Corporation had 60,000 shares of common stock outstanding. During the course of the year, Mini Tiny Home Corporation encountered the following stock-related transactions:

2/1 Issued 15,000 shares of common stock.
5/1 Issued 18,000 shares of common stock.
6/1 Declared a 7% stock dividend.
12/1 Bought back 15,000 shares of its common stock and declared the shares as treasury stock.

On December 31, what is Mini Tiny Home Corporation’s Weighted Average Common Shares Outstanding (WACSO)?

  1. 78,000.00
  2. 83,452.25
  3. 90,502.50
  4. 93,000.00

Governmental Accounting and Reporting

Which of the following is not classified under governmental funds?

  1. General Fund.
  2. Special Revenue Fund.
  3. Internal Service Fund.
  4. Permanent Fund.

Not-for-Profit (Nongovernmental) Accounting and Reporting

What are the required financial statements for voluntary health and welfare organizations?

  1. Statement of Financial Position and Statement of Cash Flows.
  2. Statement of Financial Position, Statement of Cash Flows, and Statement of Functional Expenses.
  3. Statement of Financial Position, Statement of Activities, and Statement of Cash Flows.
  4. Statement of Financial Position, Statement of Activities, Statement of Cash Flows, and Statement of Functional Expenses.

Sample CPA FAR Practice Questions’ Solutions

Conceptual Framework, Standards, Standard Setting, and Presentation of Financial Statements

Within how many days after the end of the period must a publically traded company that is a non-accelerated filer file its Form 10-Q with the Securities and Exchange Commission?

  1. 40 days.
  2. 45 days.
  3. 60 days.
  4. 90 days.

Financial Statement Accounts: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures

The following inventory method of accounting is allowed under US GAAP but is not allowed under IFRS:

  1. First in first out (FIFO).
  2. Last in first out (LIFO).
  3. Moving average.
  4. Specific identification.

Specific Transactions, Events and Disclosures: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures

As of January 1, Mini Tiny Home Corporation had 60,000 shares of common stock outstanding. During the course of the year, Mini Tiny Home Corporation encountered the following stock-related transactions:

2/1 Issued 15,000 shares of common stock.
5/1 Issued 18,000 shares of common stock.
6/1 Declared a 7% stock dividend.
12/1 Bought back 15,000 shares of its common stock and declared the shares as treasury stock.

On December 31, what is Mini Tiny Home Corporation’s Weighted Average Common Shares Outstanding (WACSO)?

  1. 78,000.00
  2. 83,452.25
  3. 90,502.50
  4. 93,000.00

Governmental Accounting and Reporting

Which of the following is not classified under governmental funds?

  1. General Fund.
  2. Special Revenue Fund.
  3. Internal Service Fund.
  4. Permanent Fund.

Not-for-Profit (Nongovernmental) Accounting and Reporting

What are the required financial statements for voluntary health and welfare organizations?

  1. Statement of Financial Position and Statement of Cash Flows.
  2. Statement of Financial Position, Statement of Cash Flows, and Statement of Functional Expenses.
  3. Statement of Financial Position, Statement of Activities, and Statement of Cash Flows.
  4. Statement of Financial Position, Statement of Activities, Statement of Cash Flows, and Statement of Functional Expenses.

 

 

By the way, sign up for our 1 Week Free Trial to try out Magoosh GMAT Prep!

No comments yet.


Magoosh blog comment policy: To create the best experience for our readers, we will only approve comments that are relevant to the article, general enough to be helpful to other students, concise, and well-written! 😄 Due to the high volume of comments across all of our blogs, we cannot promise that all comments will receive responses from our instructors.

We highly encourage students to help each other out and respond to other students' comments if you can!

If you are a Premium Magoosh student and would like more personalized service from our instructors, you can use the Help tab on the Magoosh dashboard. Thanks!

Leave a Reply