[S1] Instead of PFRS 17, the standard applicable to contracts that principally transfer financial risk, such as credit derivative, will be PFRS 9. [S2] If an entity gives a product warranty that has been issued directly by a manufacturer, dealer, or retailer, the standard that is likely to cover this warranty will be PFRS 9, not PFRS 17. [A] both are true [B] both are false [C] S1 is true [D] S2 is true
[S1] Instead of PFRS 17, the standard applicable to contracts that principally transfer financial risk, such as credit derivative, will be PFRS 9. [S2] If an entity gives a product warranty that has been issued directly by a manufacturer, dealer, or retailer, the standard that is likely to cover this warranty will be PFRS
9, not PFRS 17.
[A] both are true
[B] both are false
[C] S1 is true
[D] S2 is true
A franchise contract involves two performance obligations to performed at points in time. Which of the following is FALSE?
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[A] If each of the performance obligation has a stand alone price, the transaction price will be allocated to each according to their relative prices.
[B] If one performance obligation does not have a stand alone price, the transaction price will be allocated first to the obligation with the stand-alone price and the
remainder to the other obligation.
[C] The completion of one performance obligation allows the franchisor to recognized Franchise Revenue up to half of the transaction price.
[D] The significant uncertainty in the collectability of the transaction price will prohibit the recognition of revenue of a performance obligation already completed.
ABC Franchisor grant a franchisee the license to use ABC's old logo and trademark over five years. The franchisee creates memorabilia bearing ABC's brand. Which of the following is FALSE?
[A] Assuming that ABC is not actively marketing its brand and the franchisee expects the same, ABC may recognize any initial franchise fee as revenue upon granting of franchise.
[B] Any direct costs incurred in relation to the granting of the franchise will be expensed on grant date.
[C] ABC would likely charge a continuing fee based on sales of the franchisee.
[D]
The profit or loss on consignment is calculated after a careful analysis of expenses to be allocated and not to be allocated between the sold and unsold units: Examples of expenses that are to be allocated, except:
[A] Packing expenses related to consigned goods
[B] Freight paid by the consignee upon receipt of the shipment
[C] Shipping cost, freight and handling paid by the
consignor upon shipment
[D] Expenses relating to returned units
[S1] Under a BOT arrangement that is within the scope of IFRIC 12, the operator is a private entity which acts as a service provider and receives a right and incurs an obligation to provide public services. [S2] ABC Co., a private entity, wins a government bid to construct, operate and maintain for 25 years an expressway. At the end of the contract, ABC Co. shall handover the express way to the government. This is an example of contracts is within the scope of IFRIC 12 Service Concession Arrangements.
[A] both are true
[B] both are false
[C] S1 is true
[D] S2 is true
Entity A, a manufacturing eritty, obtains insurance against product liability from Entity B, an insurance company. Entity B then cedes the insurance contact with Entity C. another insurance company. How does Entity B account for the insurance contract ceded by Entity C?
[A] General model
[B] Premium Allocation Approach
[C] Modification to general model for reinsurance contracts
held
[D] either A or B
[E] Not accounted for under PFRS 17
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