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NEW QUESTION: 1
Which of the following would be of GREATEST assistance in determining whether to accept residual risk of a critical security system?
A. Maximum tolerable outage (MTO)
B. Annual loss expectancy (ALE)
C. Cost-benefit analysis of mitigating controls
D. Approved annual budget
Answer: C
NEW QUESTION: 2
Goddard has used the FIFO method of inventory valuation since it began operations in 1987. Goddard
decided to change to the weighted-average method for determining inventory costs at the beginning of
1 990. The following schedule shows year-end inventory balances under the FIFO and weighted-average
methods: What amount, before income taxes, should be reported in the 1990 retained earnings statement
as the cumulative effect of the change in accounting principle?
A. $0.
B. $5,000 decrease.
C. $2,000 increase.
D. $3,000 decrease.
Answer: B
Explanation:
Choice "a" is correct. $5,000 decrease. The cumulative effect of change in accounting principle is
determined as of the beginning of the year of change if comparative financial statements are not
presented. In this case, the year of change is 1990, so the cumulative effect is the difference in inventory
as of the end of 1989. [Note that inventory is a balance sheet item, so the change is based on the
balances at the end of the last year the prior method was used. Had this question shown annual income
statement amounts of cost of goods sold, we would have had to look at all the past years in the
aggregate.] This will allow us to arrive at the adjustment to obtain the amount of retained earnings that
would have been reported at the beginning of the period of change if the new accounting principle had
been used for all prior periods.
NEW QUESTION: 3
A. 0
B. 1
C. 2
D. 3
Answer: A
NEW QUESTION: 4
In this diagram, showing the Ariel Search Flow, what is the name of the components as 'X', running on the Console?
A. Ariel Proxy Server
B. Ariel Query Server
C. REST -API endpoint
D. AQL Processor
Answer: D
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