Question 1

Which of the following is not listed in IAS 1 to determine if a liability should be classified as current?

Accepted Answer

A) If the liability is guaranteed to be settled within 12 months. 
B) If the liability is held primarily for the purpose of being traded. 
C) If the entity does not have an unconditional right to defer settlement of the liability for at least 12 months. 
D) If the liability is expected to be settled in the entity's normal operating cycle. 
A) If the liability is guaranteed to be settled within 12 months. 
B) If the liability is held primarily for the purpose of being traded. 
C) If the entity does not have an unconditional right to defer settlement of the liability for at least 12 months. 
D) If the liability is expected to be settled in the entity's normal operating cycle.

Question 2

A discount on debentures issued arises when the market required rate of return is less than the coupon rate.

Accepted Answer

A) True 
 B)False

Question 3

Spoton Co Plc issues €5 million in 2-year,8%,semi-annual coupon debentures to the public.The market required rate of return is also 8%.The money is received on application and the debentures are allotted on the same day: 30 June 2013.What are the journal entries to record (a)the receipt of funds and allotment of debentures on 30 June 2013,(b)the payment of interest on 31 December 2013 and (c)the redemption of the debentures on 30 June 2015?

Accepted Answer

A)  (a) Application and allotment 30 June 2013
$\begin{array}{|c|l|c|c|}
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Application-debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|r|r|}
\hline \mathrm{Dr} & \text { Interest expense } & 400000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 400000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000 \
\hline
\end{array}$ 
B)  (a) Application and allotment 30 June 2013
$\begin{array}{|c|l|c|c|}
\hline \mathrm{Dr} & \text { Cash trust } & 5000000 & \
\hline \mathrm{Cr} & \text { Application-debentures } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Cash at bank } & 200000 & \
\hline \mathrm{Cr} & \text { Interest } & & 200000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000\
\hline
\end{array}$ 
C)  (a) Application and allotment 30 June 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Cash trust } & 5000000 & \
\hline \mathrm{Cr} & \text { Application-debentures } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Application-debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Interest expense } & 200000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 200000\
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|r|r|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000\
\hline
\end{array}$ 
D)  (a) Application and allotment 30 June 2013
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Interest receivable } & 200000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 200000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|r|l|}
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$ 
A)  (a) Application and allotment 30 June 2013
$\begin{array}{|c|l|c|c|}
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Application-debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|r|r|}
\hline \mathrm{Dr} & \text { Interest expense } & 400000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 400000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000 \
\hline
\end{array}$ 
B)  (a) Application and allotment 30 June 2013
$\begin{array}{|c|l|c|c|}
\hline \mathrm{Dr} & \text { Cash trust } & 5000000 & \
\hline \mathrm{Cr} & \text { Application-debentures } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Cash at bank } & 200000 & \
\hline \mathrm{Cr} & \text { Interest } & & 200000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000\
\hline
\end{array}$ 
C)  (a) Application and allotment 30 June 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Cash trust } & 5000000 & \
\hline \mathrm{Cr} & \text { Application-debentures } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline & & & \
\hline \mathrm{Dr} & \text { Application-debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Interest expense } & 200000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 200000\
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|r|r|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 5000000\
\hline
\end{array}$ 
D)  (a) Application and allotment 30 June 2013
$\begin{array}{|l|l|l|l|}
\hline \text { Dr } & \text { Debentures } & 5000000 & \
\hline \mathrm{Cr} & \text { Cash trust } & & 5000000 \
\hline
\end{array}$

(b) Payment of interest 31 December 2013
$\begin{array}{|l|l|l|l|}
\hline \mathrm{Dr} & \text { Interest receivable } & 200000 & \
\hline \mathrm{Cr} & \text { Cash at bank } & & 200000 \
\hline
\end{array}$

(c) Redemption of debentures 30 June 2015
$\begin{array}{|l|l|r|l|}
\hline \mathrm{Dr} & \text { Cash at bank } & 5000000 & \
\hline \mathrm{Cr} & \text { Debentures } & & 5000000 \
\hline
\end{array}$

Question 4

Tissues and Co has elected to issue preference shares to the value of €220 000.Prior to the share issue the company has assets of €780 000,liabilities of €370 000 and equity recorded at €410 000.The terms of the share issue state that these shares are non-redeemable but a guaranteed cumulative dividend of 8% of share value is payable.Calculate the debt-to-asset ratio immediately before and after the share issue.

Accepted Answer

A) before-47.4%; after - 47.4% 
B) before-47.4%; after - 37% 
C) before-52.6%; after - 63% 
D) before-47.4%; after - 59% 
A) before-47.4%; after - 47.4% 
B) before-47.4%; after - 37% 
C) before-52.6%; after - 63% 
D) before-47.4%; after - 59%

Question 5

Preference shares,as noted in IAS 32:

Accepted Answer

A) should be regarded as debt when redemption is at the option of the holder or on a specified date. 
B) will be classified as debt or equity based on their legal form rather than the substance of the financial instrument. 
C) exhibit the characteristics of equity when they are non-redeemable. 
D) will have their classification as debt or equity affected by the intention to make distributions in the future. 
A) should be regarded as debt when redemption is at the option of the holder or on a specified date. 
B) will be classified as debt or equity based on their legal form rather than the substance of the financial instrument. 
C) exhibit the characteristics of equity when they are non-redeemable. 
D) will have their classification as debt or equity affected by the intention to make distributions in the future.

Question 6

Adopting the effective-interest method means that the balance of the debenture liability represents:

Accepted Answer

A) the par value of the debenture. 
B) the present value of the liability throughout the debenture term. 
C) the adjustment to the debenture par value. 
D) the borrowing cost. 
A) the par value of the debenture. 
B) the present value of the liability throughout the debenture term. 
C) the adjustment to the debenture par value. 
D) the borrowing cost.

Question 7

The present obligation component of a liability must be based on:

Accepted Answer

A) a legal obligation only. 
B) a social obligation. 
C) a contractual obligation. 
D) none of the given answers. 
A) a legal obligation only. 
B) a social obligation. 
C) a contractual obligation. 
D) none of the given answers.

Question 8

In a constructive obligation where the entity retains discretion to avoid any future sacrifice of economic benefits,no liability should be recognised in the financial statements.

Accepted Answer

A) True 
 B)False

Question 9

IFRS 13 defines fair value measurement as:

Accepted Answer

A) the price that would be received to buy an asset or received to transfer a liability in an orderly transaction between market participants at the due date. 
B) the price that would be paid to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the due date. 
C) the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. 
D) the price that would be estimated to sell an asset or to transfer a liability in an orderly transaction between market participants at the measurement date. 
A) the price that would be received to buy an asset or received to transfer a liability in an orderly transaction between market participants at the due date. 
B) the price that would be paid to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the due date. 
C) the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. 
D) the price that would be estimated to sell an asset or to transfer a liability in an orderly transaction between market participants at the measurement date.

Question 10

Some research has shown that being in financial distress may not be all bad news for an entity because:

Accepted Answer

A) Investors will see this as an opportunity to buy into a company that can really only improve. 
B) Existing managers will want to be released from their contracts allowing new ideas to be employed. 
C) There will be no requirement to consider the social costs of retrenching employees because the accounting numbers show it is necessary. 
D) It will provide the stimulus to rethink activities that may in turn lead to improved future performance. 
A) Investors will see this as an opportunity to buy into a company that can really only improve. 
B) Existing managers will want to be released from their contracts allowing new ideas to be employed. 
C) There will be no requirement to consider the social costs of retrenching employees because the accounting numbers show it is necessary. 
D) It will provide the stimulus to rethink activities that may in turn lead to improved future performance.

Question 11

From the following extract of an amortisation schedule pertaining to a compound financial instrument,what is the net liability (assuming the debenture has not yet been repaid),at the end of Period 10? $\begin{array}{|l|l|l|l|l|l|l|}
\hline\text { Period } & \text { Opening } &\text { Effective } & \text { Coupon rate } &\text { Discount } &\text { Balance of }  & \text { Net liability }\
&\text { liability }&\text { interest }&&\text { amortisation }&\text { discount }&\
\hline 0 & & & & & 736055 & 9263945 \
\hline 1 & 9263945 & 555837 & 500000 & 55837 & 680218 & 9319782 \
\hline 2 & 9319782 & 559187 & 500000 & 59187 & 621031 & 9378969 \
\hline 3 & 9378969 & 562738 & 500000 & 62738 & 558293 & 9441707\
\hline
\end{array}$

Accepted Answer

A) Nil 
B) £9 500 000 
C) £9 905 582 
D) £10 000 000 
A) Nil 
B) £9 500 000 
C) £9 905 582 
D) £10 000 000

Question 12

From the following extract of an amortisation schedule pertaining to a compound financial instrument,what is the effective-interest rate embodied in the instrument? $\begin{array}{|l|l|l|l|l|l|l|}
\hline\text { Period } & \text { Opening } &\text { Effective } & \text { Coupon rate } &\text { Discount } &\text { Balance of }  & \text { Net liability }\
&\text { liability }&\text { interest }&&\text { amortisation }&\text { discount }&\
\hline 0 & & & & & 736055 & 9263945 \
\hline 1 & 9263945 & 555837 & 500000 & 55837 & 680218 & 9319782 \
\hline 2 & 9319782 & 559187 & 500000 & 59187 & 621031 & 9378969 \
\hline 3 & 9378969 & 562738 & 500000 & 62738 & 558293 & 9441707\
\hline
\end{array}$

Accepted Answer

A) 6% 
B) 5% 
C) Variable, as shown in the table it has increased from 5.5837% in Period 1 to 6.2738% in Period 3. 
D) 4%. 
A) 6% 
B) 5% 
C) Variable, as shown in the table it has increased from 5.5837% in Period 1 to 6.2738% in Period 3. 
D) 4%.

Question 13

Which of the following statements is ? consistent with the positive accounting theory paradigm?

Accepted Answer

A) Managers avoid future sacrifice of economic benefits debt covenants when the company is close to violation of debt covenants. 
B) Managers avoid constructive obligations in the presence of accounting based debt covenants even though there is no realistic alternative to making future sacrifice of economic benefits. 
C) Managers choose accounting methods that will decrease income to reduce the probability of debt covenant violation. 
D) Managers avoid income increasing accounting methods to reduce the probability of debt covenant violation. 
A) Managers avoid future sacrifice of economic benefits debt covenants when the company is close to violation of debt covenants. 
B) Managers avoid constructive obligations in the presence of accounting based debt covenants even though there is no realistic alternative to making future sacrifice of economic benefits. 
C) Managers choose accounting methods that will decrease income to reduce the probability of debt covenant violation. 
D) Managers avoid income increasing accounting methods to reduce the probability of debt covenant violation.

Question 14

Banshee Plc issues £12 million in 8-year,8%,semi-annual coupon debentures.The rate of return required by the market is 12%.What is the journal entry to record the first payment of interest assuming that Banshee uses the effective-interest method to amortise any discount or premium (round to the nearest pound)?

Accepted Answer

A)  $$\begin{array} { | r | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 574475 & \
\hline \mathrm { Cr } & \text { Debentures } & & 94475 \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | l | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 385525 & \
\hline \mathrm { Dr } & \text { Debentures } & 94475 & \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | l | l | l | } 
\hline \mathrm { Dr } & \text { Interest expense } & 636597 & \
\hline \mathrm { Cr } & \text { Debentures } & & 156597 \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 323403 & \
\hline \mathrm { Dr } & \text { Debentures } & 156597 & \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
A)  $$\begin{array} { | r | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 574475 & \
\hline \mathrm { Cr } & \text { Debentures } & & 94475 \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | l | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 385525 & \
\hline \mathrm { Dr } & \text { Debentures } & 94475 & \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | l | l | l | } 
\hline \mathrm { Dr } & \text { Interest expense } & 636597 & \
\hline \mathrm { Cr } & \text { Debentures } & & 156597 \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | l | r | r | } 
\hline \mathrm { Dr } & \text { Interest expense } & 323403 & \
\hline \mathrm { Dr } & \text { Debentures } & 156597 & \
\hline \mathrm { Cr } & \text { Cash } & & 480000 \
\hline
\end{array}$$

Question 15

When measuring a liability at present values,the discount rate to be used,according to paragraph 47 of IAS 37,is:

Accepted Answer

A) the pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. 
B) the after-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. 
C) the pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability, and shall also reflect risks for which future cash flows have already been adjusted. 
D) the pre-tax risk free rate. 
A) the pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. 
B) the after-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability. 
C) the pre-tax rate that reflects the current market assessments of the time value of money and the risks specific to the liability, and shall also reflect risks for which future cash flows have already been adjusted. 
D) the pre-tax risk free rate.

Question 16

When debentures are issued at a discount:

Accepted Answer

A) the discount represents the cost of attracting the funds and should be recognised as an expense. 
B) no further entries are required because the discount is calculated prior to receipt of the funds and therefore will not be recorded. 
C) the effect interest method is used to calculate the amortised cost of the financial liability. 
D) the discount amount can be used to offset any gains shown when debentures have been issued at a premium. 
A) the discount represents the cost of attracting the funds and should be recognised as an expense. 
B) no further entries are required because the discount is calculated prior to receipt of the funds and therefore will not be recorded. 
C) the effect interest method is used to calculate the amortised cost of the financial liability. 
D) the discount amount can be used to offset any gains shown when debentures have been issued at a premium.

Question 17

Entities are only required to record a liability if there has been a past transaction that has created a present obligation to another entity that is expected to result in an outflow of future economic benefits.

Accepted Answer

A) True 
 B)False

Question 18

What is the appropriate treatment for convertible notes in accordance with IAS 32 Financial Instruments: Presentation?

Accepted Answer

A) as a financial liability 
B) as equity 
C) as part debt and part equity 
D) as a financial liability and disclosure of conversion option 
A) as a financial liability 
B) as equity 
C) as part debt and part equity 
D) as a financial liability and disclosure of conversion option

Question 19

Explain,in the context of Positive Accounting Theory,the implications of making professional judgments in respect to recognising and measuring liabilities.

Accepted Answer

Researchers working

Question 20

Dubbin Plc issues £3 million in 5-year,8%,semi-annual coupon debentures.The rate of return required by the market is 6% per annum.What is the journal entry to record the issue of the debentures (rounded to the nearest pound)?

Accepted Answer

A)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 3255906 & \
\hline \mathrm { Cr } & \text { Debentures } & & 3255906 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 2744094 & \
\hline \mathrm { Cr } & \text { Debentures } & & 2744094 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 3225466 & \
\hline \mathrm { Cr } & \text { Debentures } & & 3225466 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | l | l | l | l | } 
\hline \text { Dr } & \text { Cash } & 2775534 & \
\hline \mathrm { Cr } & \text { Debentures } & & 2775534 \
\hline
\end{array}$$ 
A)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 3255906 & \
\hline \mathrm { Cr } & \text { Debentures } & & 3255906 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 2744094 & \
\hline \mathrm { Cr } & \text { Debentures } & & 2744094 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | l | l | l | l | } 
\hline \mathrm { Dr } & \text { Cash } & 3225466 & \
\hline \mathrm { Cr } & \text { Debentures } & & 3225466 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | l | l | l | l | } 
\hline \text { Dr } & \text { Cash } & 2775534 & \
\hline \mathrm { Cr } & \text { Debentures } & & 2775534 \
\hline
\end{array}$$

Which of the following is not listed in IAS 1 to determine if a liability should be classified as current?

A discount on debentures issued arises when the market required rate of return is less than the coupon rate.

Preference shares,as noted in IAS 32:

Adopting the effective-interest method means that the balance of the debenture liability represents:

The present obligation component of a liability must be based on:

In a constructive obligation where the entity retains discretion to avoid any future sacrifice of economic benefits,no liability should be recognised in the financial statements.

IFRS 13 defines fair value measurement as:

Some research has shown that being in financial distress may not be all bad news for an entity because:

Which of the following statements is ? consistent with the positive accounting theory paradigm?

When measuring a liability at present values,the discount rate to be used,according to paragraph 47 of IAS 37,is:

When debentures are issued at a discount:

Entities are only required to record a liability if there has been a past transaction that has created a present obligation to another entity that is expected to result in an outflow of future economic benefits.

What is the appropriate treatment for convertible notes in accordance with IAS 32 Financial Instruments: Presentation?

Explain,in the context of Positive Accounting Theory,the implications of making professional judgments in respect to recognising and measuring liabilities.

Dubbin Plc issues £3 million in 5-year,8%,semi-annual coupon debentures.The rate of return required by the market is 6% per annum.What is the journal entry to record the issue of the debentures (rounded to the nearest pound)?

An Overview of the International External Reporting Environment

The Conceptual Framework of Accounting and Its Relevance to Financial Reporting

Theories of Financial Accounting

An Overview of Accounting for Assets

Depreciation of Property, Plant and Equipment

Revaluations and Impairment Testing of Non-Current Assets

Inventory

Accounting for Intangibles

Accounting for Leases

Share Capital, Reserves and Share Options Employee Bonus Schemes

Accounting for Financial Instruments

Revenue Recognition Issues

The Statement of Comprehensive Income and Statement of Changes in Equity

Accounting for Income Taxes

The Statement of Cash Flows

Events Occurring After the Reporting Date

Related-Party Disclosures

Earnings Per Share

Further Consolidation Issues I: Accounting for Intragroup Transactions

Further Consolidation Issues II: Accounting for Non-Controlling Interests

Further Consolidation Issues III: Accounting for Indirect Ownership Interest

Accounting for Foreign Currency Transactions

Translating the Financial Statements of Foreign Operations

Accounting for Corporate Social Responsibility

Filters

Exam 9: An Overview of Accounting for Liabilities

Which of the following is not listed in IAS 1 to determine if a liability should be classified as current?

A discount on debentures issued arises when the market required rate of return is less than the coupon rate.

Preference shares,as noted in IAS 32:

Adopting the effective-interest method means that the balance of the debenture liability represents:

The present obligation component of a liability must be based on:

In a constructive obligation where the entity retains discretion to avoid any future sacrifice of economic benefits,no liability should be recognised in the financial statements.

IFRS 13 defines fair value measurement as:

Some research has shown that being in financial distress may not be all bad news for an entity because:

Which of the following statements is ? consistent with the positive accounting theory paradigm?

When measuring a liability at present values,the discount rate to be used,according to paragraph 47 of IAS 37,is:

When debentures are issued at a discount:

Entities are only required to record a liability if there has been a past transaction that has created a present obligation to another entity that is expected to result in an outflow of future economic benefits.

What is the appropriate treatment for convertible notes in accordance with IAS 32 Financial Instruments: Presentation?

Explain,in the context of Positive Accounting Theory,the implications of making professional judgments in respect to recognising and measuring liabilities.

Dubbin Plc issues £3 million in 5-year,8%,semi-annual coupon debentures.The rate of return required by the market is 6% per annum.What is the journal entry to record the issue of the debentures (rounded to the nearest pound)?

An Overview of the International External Reporting Environment

The Conceptual Framework of Accounting and Its Relevance to Financial Reporting

Theories of Financial Accounting

An Overview of Accounting for Assets

Depreciation of Property, Plant and Equipment

Revaluations and Impairment Testing of Non-Current Assets

Inventory

Accounting for Intangibles

Accounting for Leases

Share Capital, Reserves and Share Options Employee Bonus Schemes

Accounting for Financial Instruments

Revenue Recognition Issues

The Statement of Comprehensive Income and Statement of Changes in Equity

Accounting for Income Taxes

The Statement of Cash Flows

Events Occurring After the Reporting Date

Related-Party Disclosures

Earnings Per Share

Further Consolidation Issues I: Accounting for Intragroup Transactions

Further Consolidation Issues II: Accounting for Non-Controlling Interests

Further Consolidation Issues III: Accounting for Indirect Ownership Interest

Accounting for Foreign Currency Transactions

Translating the Financial Statements of Foreign Operations

Accounting for Corporate Social Responsibility

Filters