II. Supply the appropriate initial and subsequent measurement of the following financial statement elements using the following codes: Fair Value Cost or Transaction Price FVIPL FVTOCI Amortized Cost E Present Value Initial Measurement Sabsequent Measurement Available for Sale Financial Assets 41 42 Held-to-Maturity Investments 43 44 Non-Marketable Investments 45 46 Lease Receivable 47 48 Other Current Assets 49 50 Short-term Borrowings 51 52 Financial Derivatives 53 54 Lease Liability Trade Payable 55 56 57 58 Employee Benefit Obligation 59 60 Deferred Revenue 61 62 Long Term Debts or Borrowings Due from Employees Prepayments 63 64 65 66 67 68 Right-to-Use Assets 69 70
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- Under what cisrcumstances under PFRS 9 can an entity classify financial assets that meet the amortized cost criteria as at FVTPL? A. where the business model approach is adopted B. where the financial asset passes the contractual cash flow characteristics test C. where the instrument is held to maturity D. if doing so eliminates or reduces an accounting mismatchQ11 Which of the following options is INCORRECT regarding financial assets and the subsequent measurement model(s)? Select one: a. Financial Asset: Equity instrument Management Intention: Realise fair value changes Measurement Model: Fair value, adjustments in OCI _ b. Financial Asset: Debt instrument Management Intention: Earning contractual cash flows Measurement Model: Amortised cost _ c. Financial Asset: Equity instrument Management Intention: Realise fair value changes Measurement Model: Fair value, adjustments in SPL _ d. Financial Asset: Debt instrument Management Intention: Earning contractual cash flows Measurement Model: Fair value, adjustments in OCI _Which of the following is measured at fair value with fair value changes recognized in profit or loss? a. held to maturity investments b. financial assets designated at FVPL c. FVOCI d. all of these
- 1. Assuming the investment is appropriately recognized as a financial asset intended to collect contractual cash flows and also to sell the bonds in open market: How much unrealized gain (loss) is to be reflected in the statement of changes in equity and statement of comprehensive income at yearend 2020? 2. Assuming the investment is appropriately recognized as a financial asset intended to collect contractual cash flows and also to sell the bonds in open market: What is the carrying value of the investment on December 31, 2020? 3. Assuming the investment is appropriately recognized as a financial asset intended to collect contractual cash flows and also to sell the bonds in open market: Determine the gain or (loss) to be recorded upon the sale of the investment.Which of the following is not a category of financial assets under GAM? Group of answer choices A.Held to maturity investments B.Available for sale financial assets C.Financial asset at fair value through other comprehensive income D.Loans and receivableUse IFRS 9 to determine how to subsequently measure the following financial assets. Three choices of measurement basis are amortized cost, fair value through other comprehensive income, and fair value through profit or loss. Provide justification for your choice. Long-term loans that are held for collecting contractual cash flows till their maturities, but may be subsequently sold if the loans’ credit risk substantially increases. Investments in bonds that are held for collecting contractual cash flows, and may be subsequently sold to re-invest the cash in financial assets with a higher return. Subprime (high risk) mortgage loans that were originated by a mortgage-broker firm that always sell these loans to banks right after their origination. Forward contracts that an EU bank purchased to hedge the exposure to changes in fair value of US$-denominated loans. Investment in bonds that are convertible into common stock of the bond issuer. Investment in bonds that pay a variable market…
- 4. Financial liabilities other than FVPL liabilities are initiallymeasured at fair value plus transaction costs.5. Amortized cost financial liabilities are subsequently measuredat the present value of the cash outflows from the instrument.6. Financial liabilities may be subsequently reclassified betweenthe amortized cost and fair value measurement categories.7. Trade payables and other liabilities that are part of an entity'sworking capital may be presented as current liabilities even ifthey are expected to be settled beyond one year.8. According to PAS 1, a currently maturing debt that the entity'smanagement intends to refinance is presented as noncurrent.9. According to PFRS 15, if an entity expects that a portion of giftcertificates sold will not be redeemed, the entity recognizes theexpected breakage amount as revenue in proportion to thepattern of rights exercised by customers.10. Unearned revenue is revenue that is earned but not yet collected Please answer this all. Thank you1. The unrealized gain/loss from investment valuation for trading securities and available-for-sale securities should be reported in: Select one: a. the income statement for both securities. b. the balance sheet statement for both securities. c. the income statement and the balance sheet statement, respectively. d. the balance sheet statement and the income statement, respectively. In applying the fair value option under ASC 825-10-25 (Predecessor literature Statement of Financial Accounting Standards No. 159: The Fair Value Option for Financial Assets and Financial Liabilities), a company Select one: a. has the option to apply the fair value option to its investments classified as securities held-to-maturity and securities-available-for-sale on an instrument-by-instrument basis. b. is required to apply the fair value option to its investments classified as securities held-to-maturity and securities available-for-sale. c. has to apply the fair value…For investment in equity securities carried as FVOCI under PFRS 9, the difference between the carrying value of the investment and its related cumulative unrealized gain or loss-OCI is * A. its unrealized gain or loss reported as a component of OCI for the period B. Its amortized cost C. its initial cost D. its unrealized gain or loss reported under profit or loss for the period A gain or loss arising on the initial recognition of biological assets and from a change in the fair value less costs to sell of a biological asset shall be included in: * A. Profit or loss for the period B. Other comprehensive income C. A separate revaluation reserve D. Either in the profit or loss or the other comprehensive income for the period The following items are generally classified as plant assets, except: a. Improvements to leased facilities b. Property held for future plant sites c.…
- All of the following components of other comprehensive income are reclassified subsequently to profit or loss, except Group of answer choices A. Unrealized gain on investment in bonds securities measured at fair value through OCI B. Gain from translating financial statements of a foreign operation C. Actuarial gain on projected benefit obligation D. Unrealized gain on futures contract designated of cash flow hedgeFair Value Accounting and Valuation in 3 Steps: Asset or Liability Identification: The first step involves identifying the specific assets or liabilities that will be measured at fair value. This could include financial instruments, tangible assets, intangible assets, or other items on the balance sheet. Market-Based Valuation Techniques: Fair value is determined using market-based valuation techniques. This may involve assessing current market prices, recent transactions, or employing valuation models such as discounted cash flows, comparable sales, or option pricing models. Consistent Application and Disclosure: Fair value accounting requires consistent application of valuation methods across reporting periods. Additionally, transparency and disclosure are crucial, with companies providing detailed information about the inputs, assumptions, and methods used in fair value measurements. Objective Type Question: In fair value accounting, what is the primary purpose of…Which of the following is not an alternative for a capital charge for Operational Risk as stated in Basel II? a. Advanced Measurement Approach (AMA) b. Asset-Liability Matching c. Basic Indicator (15% of annual gross income) d. Standardized (different percentage for each business line)