WorldatWork Certified Compensation Professional (CCP) T7 Questions & Answers

• Question 81:

  When the economic consequences of a standard or rule is ignored, which characteristic is being represented?

  A. Neutral

  B. Verifiability

  C. Complete

  D. Relevance

  Correct Answer: A

• Question 82:

  Which of the following describes the concerns of Level 3 of the conceptual framework for financial reporting?

  A. Basic objective

  B. Recognition, measurement, and disclosure concepts

  C. Fundamental concepts

  D. Elements of financial statements

  Correct Answer: B

• Question 83:

  What are the usual and customary costs that a company incurs to support its main business called?

  A. Operating expenses

  B. Current liabilities

  C. Current debt

  D. Total expenses

  Correct Answer: A

• Question 84:

  Which of the following are ingredients of the fundamental qualitative characteristics of faithful representation?

  A. Complete, neutral, freedom from error

  B. Assets, liabilities, equity

  C. Predictive value, confirmatory value, relevance

  D. Comparability, verifiability, timeliness

  Correct Answer: A

• Question 85:

  What is a constructive obligation?

  A. When a company recognizes the expected cost of profit-sharing and bonus payments

  B. When a company has no realistic alternative but to make payments

  C. When a change in the company's informal practices would cause unacceptable damage to its relationship with employees

  D. The required accounting entry for liabilities or accrued expenses or cash paid

  Correct Answer: C

• Question 86:

  When the quality of information confirms users' earlier expectations, which characteristic is being represented?

  A. Verifiability

  B. Predictive value

  C. Confirmatory value

  D. Faithful representation

  Correct Answer: C

• Question 87:

  Why is faithful representation important in accounting documentation?

  A. It ensures neutrality on the part of the company's accounting department

  B. It guarantees that all information is free from error

  C. It is useful if information represents what it purports to represent

  D. It indicates that accountants have confirmed all of the data

  Correct Answer: C

• Question 88:

  Which statement best describes the revalued amount of an asset?

  A. Its fair value at the date of revaluation less accumulated impairment

  B. Its fair value at the date of revaluation less accumulated depreciation

  C. Its fair value, less retained earnings

  D. Its fair value at the date of revaluation less accumulated depreciation and accumulated impairment

  Correct Answer: D

• Question 89:

  Which of the following should be used when discounting a benefit in order to determine the present value of the defined benefit obligation and the current service cost?

  A. Fair value

  B. Time value of money

  C. Net present value

  D. The corporate vision

  Correct Answer: C