1. Which of the following entities appears not to be a goingconcern?
a. Company M’s management is unable to extend its long-term loan,and, given its losses
in recent years, it is unlikely that it will be able to raise fundsthrough other means to
pay for the loan.
b. Company K’s management intends to liquidate the entity.
c. Company L’s management is being forced to cease the entity’soperations due to a major
change in government policies.
d. None of the three companies is likely to be a goingconcern.
2. When the classification of items in its financial statements ischanged, the entity:
a. Must not reclassify the comparative amounts unless absolutelynecessary.
b. Must reclassify comparative amounts, unless it is impractical todo so.
c. Has an unrestricted choice whether to reclassify the comparativeamount or not.
d. Must preserve consistency in reporting, and no newreclassification should be allowed.

3. An entity’s equity may decrease during a financial periodbecause:
a. Other comprehensive income was lower than net profit.
b. There was a new share issuance.
c. Total comprehensive income was higher than net profit.
d. Prior-period errors resulted from overstatement of the previousyear’s profits.
4. The notes to the accounts can be used for the following, exceptfor:
a. Explaining why a certain accounting standard was notfollowed.
b. Providing disclosures of items not shown on the face offinancial statements.
c. Providing additional breakdown of line items on the face offinancial statements.
d. Explaining the accounting policies used.

My answers are b, a, d, d

anything wrong, please correct me.