Question

Under IFRS, non-strategic debt investments are initially recorded using: -Fair value through profit and loss method....

Under IFRS, non-strategic debt investments are initially recorded using:
-Fair value through profit and loss method.
-Amortized cost method.
-Consolidation method.
-Amortized cost method.
-Both C & D are correct.

Homework Answers

Answer #1

Non strategic investment is initially recorded using fair value through profit and loss method (FVTPL)

Initial purchase is recorded as purchase cost but excludes transaction costs; transaction costs are expensed.

Any investment income or loss arising from the fair value test is recorded on the income statement.

The carrying value is adjusted to fair value on the balance sheet.

Under IFRS, non-strategic debt investments are initially recorded using Fair value through profit and loss method.

Answer is a. Fair value through profit and loss method.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Which of the following statements is not true? Under the fair value through profit or loss...
Which of the following statements is not true? Under the fair value through profit or loss model, both realized and unrealized gains and losses are reported in the income statement. Under the amortized cost model, no unrealized gains or losses are reported. Non-strategic investments are purchased to generate investment income. Under the fair value through other comprehensive income model gains and losses are critical to the evaluation of management.
1The costs of issuing debt under GAAP require a*That the debit of the issuance costs be...
1The costs of issuing debt under GAAP require a*That the debit of the issuance costs be compensated with the debt to the lowest bonds b*The debit of issuance costs is offset against the debt to increase the bonds payable c*A debit to the debt issuance asset account which is amortized during the duration of the debt 2-GAAP requires that if the company chooses to report bonds at fair value they a*They must report the changes as the increase or decrease...
QUESTION 22 According to IAS 39 and IFRS 9, which is true about the classification of...
QUESTION 22 According to IAS 39 and IFRS 9, which is true about the classification of financial assets and financial liabilities? A. Bonds payable should be classified as financial liability measured as fair value B. Held to maturity investments should be classified as financial assets measured as fair value. C. Loans and receivables should be classified as financial assets measured as amortized cost. D. Deposits from customers should be classified as financial liabilities measured as fair value. 10 points   ...
Under the fair value/cost method of accounting for stock investments, an investor records dividends received from...
Under the fair value/cost method of accounting for stock investments, an investor records dividends received from earnings accumulated after the investment is acquired as dividend income. How does an investor treat dividends received from earnings accumulated before an investment is acquired?
1. Held-to-muturity investments are reported at A. maturity value. B. amortized cost. C. fair value. D....
1. Held-to-muturity investments are reported at A. maturity value. B. amortized cost. C. fair value. D. acquisition cost. 2. Ace Bonding Company purchased merchandise inventory on account and it uses perpetual inventory system. The inventory costs $2,000 and is expected to sell for $3,000. Which account will Ace debit to? A. Purchases B. Cost Of Goods Sold C. Inventory D. Accounts Receivable 3. If Top Company owns 5% of the ordinary shares of Bon Company, then Top Company typically: A....
Walker Inc. began operations on January 1, 20X5. The company reports its financial statements in accordance...
Walker Inc. began operations on January 1, 20X5. The company reports its financial statements in accordance with IFRS. On December 31, 20X5, the company owned the following investments: Type Category Cost Fair value at year end Other 5% bonds Amortized cost $250,000 $249,000 Purchased at par on January 1, 20X5. Face value is $250,000. Shares fair value through profit or loss (FVPL) 85,000 93,000 $15,000 dividends declared in 20X5; $11,000 was received in the 20X5 fiscal year and the remaining...
8. According to IAS 39 and IFRS 9, which is true about the classification of financial...
8. According to IAS 39 and IFRS 9, which is true about the classification of financial assets and financial liabilities? A. Bonds payable should be classified as financial liability measured as fair value B. Held to maturity investments should be classified as financial assets measured as fair value. C. Loans and receivables should be classified as financial assets measured as amortized cost. D. Deposits from customers should be classified as financial liabilities measured as fair value. 9. Under IFRS, if...
Eli Fish Corp. (EFI), a passive investor, owns various investments in debt and equity securities. EFI’s...
Eli Fish Corp. (EFI), a passive investor, owns various investments in debt and equity securities. EFI’s policy is to prepare journal entries for adjustments and accruals at year end. The company elects to reclassify reserves (accumulated other comprehensive income) to retained earnings upon derecognition of investments in equity securities at FVOCI-elect. EFI engaged in various investment-related transactions as detailed below. All interest and dividend payments were received on the scheduled payment dates. While the resulting journal entries will all be...
The following are not business combination transactions of entities under common control The parent company exchanges...
The following are not business combination transactions of entities under common control The parent company exchanges its ownership in a portion of the net assets of its subsidiary for additional shares issued by another subsidiary. The parent company transfers a portion of the net assets of its subsidiary to the assets of the parent The parent company purchases the net assets or part of the ownership rights of non-controlling shareholders The parent company transfers part of its ownership rights in...
1. In​ 2017, Gigajoule Corporation used the equity method to account for a​ 25% ownership interest...
1. In​ 2017, Gigajoule Corporation used the equity method to account for a​ 25% ownership interest in Megawatt Corporation. If Megawatt Corporation reports​ $400,000 of income and pays​ $80,000 of dividends in​ 2017, the net effect of the entries made by Gigajoule Corporation in 2017 will be​ to: A. reduce the Investment account by​ $320,000 B. increase the Investment account by​ $320,000 C. reduce the Investment account by​ $80,000 D. increase the Investment account by​ $80,000 2. Investments at fair...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT