12 mandatory redeemable preference share is a

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12.Mandatory redeemable preference share is a financial liability. Accordingly, dividends paid toholders is an interest as component of finance costDownloaded by Anonymous User2 ([email protected])lOMoARcPSD|7338455
FINANCIAL ACCOUNTING VOL1 SUMMARY _VALIXjkycpa13.financial assets at fair value include both equity securities and debt securities while financialassets at amortized cost include only debt securities14.Fair value through profit/loss:a.Trading securitiesb.Financial assets designated on initial recognition as at fair value through profit/lossLike investment in bonds and other debt instrumentsc.Investments in quoted equity instruments ( by consequence)15.In financial assets held for trading, transaction costs are expensed outright16.Transaction costs do not include debt premiums or discounts, financing costs and internal andadministrative or holding costs17.Financial assets held for trading are derivatives and not an effective hedging instrument.18.At initial recognition, an entity shall measure a financial asset at fair value plus, in the case offinancial asset not at fair value, transaction costs. In subsequent measurement, an entity shallchoose between fair value and amortized cost.19.Disclosure of the cost of security is necessary20.Notes to FS shall disclose the individual securities with their corresponding carrying amountand market value21.Cumulative unrealized loss/gain is shown in the statement of changes in equity22.Unrealized loss/gain may be transferred to retained earnings but not subsequently transferredto profit/loss23.The entity shall disclose the change in business novel as this is a significant and demonstrableevent.24.For financial assets measured at fair value, all gains and losses are either presented in profit orloss or in other comprehensive income. It is not necessary therefore to assess financial assetsmeasured at fair value for impairment.25.Only financial assets at amortized cost is tested for impairment.26.IASB rejected totally the tainting provision in PAS 3927.PFRS 9 amended PAS 1 to require an entity to present as a separate line item in the incomestatement all gains and losses from the derecognition of financial assets measured at amortizedcost.Investment in Equity securities1.Equity securities may also represent rights and options to acquire ownership shares2.Cash150,000Investment in equity securities100,000Dividends income5,000Gain on sale of investment45,0003.Property dividends:Investment in equity sec50,000Dividends income50,000*recorded at fair value.4. Property dividends or dividends in kind are dividends in the form of property or noncash assets.Merchandise inventoryDividend income4.Liquidating dividend may be in the form of cash or noncash assets5.Wasting assets(partly income and return of capital):CashDividend incomeInvestment in ESDownloaded by Anonymous User2 ([email protected])lOMoARcPSD|7338455
FINANCIAL ACCOUNTING VOL1 SUMMARY _VALIXjkycpa6.

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Term
Fall
Professor
N/A
Tags
Balance Sheet, Generally Accepted Accounting Principles, NR, associate

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