e following statements are correct regarding interest component in the purchase price of bonds? (i) The fair value of a bond purchased cum-interest is the quoted price of the bond on the bond market. (ii) The fair value of a bond purchased cum-interest is the quoted price of the bond on the bond market less interest portion in the bond price (iii) The fair value of a bond purchased cum-interest is the quoted price on the bond market. (iv) The dividend component has no influence in the accounting treatment of the investment in the bonds. Select one: a. (i), (ii) and (iii) only b. (i), (ii), (iii) and (iv)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
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Chapter1: Financial Statements And Business Decisions
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Which of the following statements are correct regarding interest component in the purchase price of bonds?

(i) The fair value of a bond purchased cum-interest is the quoted price of the bond on the bond market.

(ii) The fair value of a bond purchased cum-interest is the quoted price of the bond on the bond market less interest portion in the bond price

(iii) The fair value of a bond purchased cum-interest is the quoted price on the bond market.

(iv) The dividend component has no influence in the accounting treatment of the investment in the bonds.

Select one:
a. (i), (ii) and (iii) only
b. (i), (ii), (iii) and (iv)
c. (ii) only
d. (i) and (iv) only
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