QUESTION: 145

Which THREE of the following statements are true in relation to financial assets designated as fair value through profit or loss under IAS 39 Financial Instruments: Recognition and Measurement?

Shares in another entity held for short term trading purposes fall within this category.
Transaction costs in relation to these assets are expensed to profit or loss on acquisition.
Transaction costs in relation to these assets are added to the initial cost of the asset on acquisition.
The gain or loss on the subsequent measurement of these assets is recorded within other comprehensive income.
The gain or loss on the subsequent measurement of these assets is recorded within profit for the year.
Once the asset has been subsequently measured to fair value an impairment review is undertaken.

Answer(s): A,B,E

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AB acquired a financial investment on 1 January 20X9, incurring $5,000 related agency fees. AB initially classified the investment as held for trading, in accordance with IAS 32 Financial Instruments:
Presentation.
Which of the following statements reflects the accounting treatment that AB adopted in respect of this investment when it prepared its financial statements to 31 December 20X9?

Agency fees were recorded as an expense and the gain/loss on the remeasurement of the investment at the year end was recorded in profit or loss for the year.
Agency fees were recorded as an expense and the gain/loss on the remeasurement of the investment at the year end was recorded in other comprehensive income.
Agency fees were added to the cost of the investment and the gain/loss on the remeasurement of the investment at the year end was recorded in profit or loss for the year.
Agency fees were added to the cost of the investment and the gain/loss on the remeasurement of the investment at the year end was recorded in other comprehensive income.

Answer(s): A

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QUESTION: 147

ST has sold its main office property, which had a carrying value of $360,000, to AB, a property management entity.
The property was sold for $400,000 which is equal to its fair value and was immediately leased back under an operating lease agreement.
Which of the following journals will record this transaction?

Option
Option
Option

Answer(s): A

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QUESTION: 148

On 1 January 20X4 EF grants each of its 125 employees 500 share options on the condition that they remain in employment for 3 years. During the year to 31 December 20X4 10 employees left and It is expected that a further 25 will leave before the end of the vesting period. The fair value of each share option is $30 on 1 January 20X4 and $45 on 31 December 20X4.
What is the journal entry in respect of these share options in EF's financial statements for the year ended 31 December 20X4?

Option
Option
Option

Answer(s): A

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QUESTION: 145

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QUESTION: 148