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CIMA F1 Financial Reporting Exam
F1 Financial Reporting (Page 3 )

Updated On: 12-Feb-2026
Page 3 of 40
PDF with 194 Questions

Which THREE of the following are conditions that must be met to allow an asset to be categorised as held for sale?

  1. Management is committed to a plan to sell
  2. The asset is being actively marketed at a reasonable price
  3. The asset is available for immediate sale
  4. A buyer has already expressed interest
  5. The sale of the asset is likely to generate a significant profit

Answer(s): A,B,C



The subsidiary company of Group XY has purchased £150,00 worth of goods its parent company. However the goods purchased have yet to arrive at the subsidiary at the end of the financial year 20X4, meaning there is a disagreement in the current account balances between the parent and subsidiary.
With Group XY looking to produce its CSOFP for the end of the financial year, which of the following statements are true in relation to accounting for this disagreement? Select ALL that apply.

  1. The adjustments to resolve this disagreement, need to be accelerated, so they can be included in the consolidation of assets for the CSOFP for 20X4
  2. £150,000 worth of inventory will be debited into the subsidiary's inventory account
  3. As the goods have not reached the subsidiary by the end of the financial year 20X4, they will be included in the CSOFPfor the next financial year
  4. £150,000 worth of inventory will be credited into the subsidiary's inventory account
  5. £150,000 will be debited to the payables account of the parent company
  6. £150,000 will be credited to the payables account of the subsidiary company
  7. £150,000 will be credited into the receivables account of the parent company

Answer(s): A,B



The IV Group is formed of I Ltd and its subsidiary company V Ltd. I Ltd purchased 67% of V Ltd's ordinary share capital on 31 March 20X3.
The purchase cost I Ltd £129,000. At the date of purchase V Ltd's net assets were £155,000 while its share capital was £37,000. NCI fair value on the date of acquisition was £31,000.
What was the amount of goodwill I Ltd paid as part of the acquisition. Calculate this figure using both the proportion of net assets method and the full good will method for valuing the non-controlling interest.

  1. Proportion of net assets method = £25,150
  2. Full goodwill method = £5,000
  3. Proportion of net assets method = £5,000
  4. Full goodwill method = £25,150
  5. Proportion of net assets method = £77,150
  6. Full goodwill method = £57,000

Answer(s): A,B



Company R use a defined benefit plan pension scheme. Employee UW has been working for Company R for 25 years. The defined benefit plan is 1.5% of the employee's annual salary during their time at the company,
for every year of employment.
Employee UW started on a £18,000 per annum salary. After 10 years of employment. Employee UW received a promotion and began earning £22,000. After another 3 years of employment. Employee UW got promoted to a wage of £35,000, and is still on this salary now. How much pension has Employee UW accumulated since working at Company R?

  1. £9,900
  2. £18,000
  3. £6,750
  4. £9,375

Answer(s): A



Which TWO of the following statements about accounting for associates are true?

  1. Intra associate transactions are not eliminated
  2. Unrealised profits are adjusted for
  3. Intra associate transactions are eliminated
  4. Unrealised profits are not adjusted for

Answer(s): A,B






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