Test on Bilingual Financial Statement Terminology

Question 1: The "Total change in unrealized gains/losses on derivative instruments" presented in the Consolidated Statements of Comprehensive Income only includes the "Change in fair value of derivative instruments."

A. Ano

B. Ne

Explanation: The study materials show that "Total change in unrealized gains/losses on derivative instruments" also includes "Adjustment for net (gains)/losses realized and included in net income," in addition to the "Change in fair value of derivative instruments."

Question 2: The 'Ending balances' of 'Common stock and additional paid-in capital' are affected by 'Share-based compensation' and 'Common stock issued'.

A. Ano

B. Ne

Explanation: The study materials under 'CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY' show that 'Share-based compensation' and 'Common stock issued' are listed as specific components contributing to the 'Ending balances' within the 'Common stock and additional paid-in capital' section.

Question 3: According to the 'CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY' for APPLE INC., which of the following items directly affect the 'Retained earnings/(Accumulated deficit)' ending balance?

A. Net income

B. Dividends and dividend equivalents declared

C. Change in foreign currency translation, net of tax

D. Common stock repurchased

Explanation: The 'Retained earnings/(Accumulated deficit)' section within the 'CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY' lists 'Net income', 'Dividends and dividend equivalents declared', and 'Common stock repurchased' as items that modify its balance. 'Change in foreign currency translation, net of tax' is part of 'Other comprehensive income/(loss)' and affects Accumulated other comprehensive income, not Retained earnings directly.

Question 4: According to the provided 'Consolidated Statements of Comprehensive Income' for Apple Inc., which of the following items are listed under 'Other comprehensive income/(loss)'?

A. Change in foreign currency translation, net of tax

B. Net income

C. Change in unrealized gains/losses on marketable debt securities, net of tax

D. Dividends and dividend equivalents declared

Explanation: The 'Consolidated Statements of Comprehensive Income' explicitly lists 'Change in foreign currency translation, net of tax' and 'Change in unrealized gains/losses on marketable debt securities, net of tax' as components of 'Other comprehensive income/(loss)'. 'Net income' is a separate line item before 'Other comprehensive income/(loss)', and 'Dividends and dividend equivalents declared' are found in the 'Consolidated Statements of Shareholders' Equity'.

Question 5: Research and development is classified as an operating expense.

A. Ano

B. Ne

Explanation: The CONSOLIDATED STATEMENTS OF OPERATIONS categorize Research and development under Operating expenses.