Advise the directors of the entity, Financial Accounting

An entity had the following transactions during the year ended 31 December 2010:

  • The entity invested in a convertible bond on its issue date. The bond matures four years after the issue date and at that date the bond can be converted into ordinary shares of the investee or repaid at par. The entity's plan for the bond is to hold it until it matures and collect the cash flows.
  • The entity entered into a contractual commitment to make a variable rate loan to a customer beginning on 1 January 2011 for a fixed period at 1% less than the rate at which the entity (not the customer) can borrow money.
  • The entity sold to a third party the right to receive the interest cash flows on a fixed maturity debt instrument it holds and will continue to legally own up to the date of maturity. The debt instrument is quoted in an active stock market. The entity has no obligation to compensate the third party for any cash flows not received.

Advise the directors of the entity of the accounting treatment of the above transactions under IFRS 9 (insofar as the information permits) for the year ended 31 December 2010.

Posted Date: 3/15/2013 3:07:11 AM | Location : United States







Related Discussions:- Advise the directors of the entity, Assignment Help, Ask Question on Advise the directors of the entity, Get Answer, Expert's Help, Advise the directors of the entity Discussions

Write discussion on Advise the directors of the entity
Your posts are moderated
Related Questions
As an asset The argument for this statement is that the survivorship policy is an investment because eventually the partnership will receive either the surrender value or the s

The maturity date of a note receivable 1. Is the day of the credit sale 2. Is the day the note was signed 3. Is the day the note is due to be paid 4. Is the date of the first payme

Which of the following statements is FALSE of Just-In-Time (JIT) manufacturing systems? Answer Demand pull means a closer relationship with the customer. The power of supp

You were hired as a consultant to Giambono Company, whose target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 6.00%, the cost

a private owned business, pay salary to its employees according to the Ethiopian calendar month to the addis ababa city administration tax authority . Basic salary 3936 ,Normar wor

Debra Motors's 14% coupon rate, semiannual payment, $1,000 par value bonds that mature in 20 years are callable 3 years from now at a price of $1,075. The bonds sell at a price of

Investment Tax Credit - This is a component of general business credit and comprises the following: 1. Energy credit 2. Rehabilitation credit 3. Reforestation credit

A company presently pays a dividend of $2 per share, D0 = 2. It is estimated that the company's dividend will enhance at a rate of 17% percent per year for the next 2 years, then t


What is the present value of $500 per year for ten years at 12 percent, assuming a regular, or ordinary annuity?