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Current Liabilities PROBLEM 1: TRUE OR FALSE 2. Legal obligations arise only from law. 3. A long-term debt that is maturing within 12 months from the end of the reporting period is a current liability. 4. Financial liabilities other than FVPL liabilities are initially measured at fair value plus transaction costs.

Current Liabilities PROBLEM 1: TRUE OR FALSE 2. Legal obligations arise only from law. 3. A long-term debt that is maturing within 12 months from the end of the reporting period is a current liability. 4. Financial liabilities other than FVPL liabilities are initially measured at fair value plus transaction costs.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Current Liabilities - True/False 2-10
Current Liabilities PROBLEM 1: TRUE OR FALSE 2. Legal obligations arise only from law. 3. A long-term debt that is maturing within 12 months from the end of the reporting period is a current liability. 4. Financial liabilities other than FVPL liabilities are initially measured at fair value plus transaction costs. 5. Amortized cost financial liabilities are subsequently measured at the present value of the cash outflows from the instrument. 6. Financial liabilities may be subsequently reclassified between the amortized cost and fair value measurement categories. 7. Trade payables and other liabilities that are part of an entity's working capital may be presented as current liabilities even if they are expected to be settled beyond one year. 8. According to PAS 1, a currently maturing debt that the entity's management intends to refinance is presented as noncurrent. 9. According to PFRS 15, if an entity expects that a portion of gift certificates sold will not be redeemed, the entity recognizes the expected breakage amount as revenue in proportion to the pattern of rights exercised by customers. 10. Unearned revenue is revenue that is earned but not yet collected
Transcribed Image Text:Current Liabilities PROBLEM 1: TRUE OR FALSE 2. Legal obligations arise only from law. 3. A long-term debt that is maturing within 12 months from the end of the reporting period is a current liability. 4. Financial liabilities other than FVPL liabilities are initially measured at fair value plus transaction costs. 5. Amortized cost financial liabilities are subsequently measured at the present value of the cash outflows from the instrument. 6. Financial liabilities may be subsequently reclassified between the amortized cost and fair value measurement categories. 7. Trade payables and other liabilities that are part of an entity's working capital may be presented as current liabilities even if they are expected to be settled beyond one year. 8. According to PAS 1, a currently maturing debt that the entity's management intends to refinance is presented as noncurrent. 9. According to PFRS 15, if an entity expects that a portion of gift certificates sold will not be redeemed, the entity recognizes the expected breakage amount as revenue in proportion to the pattern of rights exercised by customers. 10. Unearned revenue is revenue that is earned but not yet collected
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