Answered: the core principle of the new…

the core principle of the new accounting standard (IFRS 16) is that an entity shall recognise assets and liabilities arising from a lease. Select one alternative: True False

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter4: Balance Sheet: Presenting And Analyzing Resources And Financing

Section: Chapter Questions

Problem 3Q

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In accordance with AASB 9, the recognition of a financial asset or financial liability will be influenced by considerations as to whether there is a contractual right to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable, or potentially unfavourable, to the entity. Explain what this requirement means.
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A currently maturing obligation of the entity is classified on the SFP as a? a. Current Asset b.Current Liabilities c. Non-Current Liabilities d. Non-Current Assets
What are the measurement issues in the IFRS16 Leases standards.? a)Which basis of measurement is allowed? b)why Why do you think that measurement basis is preferred(explain by referring to qualitative characteristics of financial information)
Pursuant to the conceptual framework, for an item to be characterised as a liability the definition of liabilities must be applicable to the transaction or event, and the recognition criteria should also be satisfied. Applying the definition of liabilities, there are three key components in the definition of ‘liability’, these being:1. There must be an expected future disposition of economic benefits to other entities.2. There must be a present obligation.3. A past transaction or other event must have created the obligation.Required:Take any two examples of liabilities and test if they meet all three requirements.
Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org).Required:Determine the specific citation for accounting for each of the following items:1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed.2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities.3. Accounting for the revenue from separately priced extended warranty contracts.4. The criteria to determine if an employer must accrue a liability for vacation pay
Choose the correct statement below:A. Contingent liability is both probable and measurable.B. An intangible asset is an identifiable asset with physical substance.C. A contingent asset is recognized in the period when realized.Lease liability is a current liability.D. Lease liability is a current liability.
1. An SME shall measure a provision a. at fair value b. at cost c. at the best estimate of the amount required to settle the obligation at the reporting date. d. any of these
Generally accepted accounting principles require that certain leaseagreements be accounted for as purchases. The theoretical basis for thistreatment is that a lease of this type A. Effectively conveys all of the benefits and risks incident to the ownership of property B. Is an example of form over substance C. Provides the use of the leased asset to the lessee for a limited period of time D. Must be recorded in accordance with the concept of cause and effect
Access the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ) Required: Determine the specific citation for accounting for each of the following items: 1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities. 3. Accounting for the revenue from separately priced extended warranty contracts. 4. The criteria to determine if an employer must accrue a liability for vacation pay.
What is the principle for recognition of a financial asset in PFRS 9? A. A financial asset is recognized when, and only when, the entity obtains control of the instrument and has the ability to dispose of the financial asset independent of the actions of others. B.A financial asset is recognized when, and only when, the entity becomes a party to the contractual provisions of the instrument. C. A financial asset is recognized when, and only when, the entity obtains the risks and rewards of ownership of the financial asset and has the ability to dispose of the financial asset. D. A financial asset is recognized when, and only when, it is probable that future economic benefits will flow to the entity and the cost or value of the instrument can be measured reliably.
For each class of provision, AASB 137 Provisions, Contingent Liabilities and... For each class of provision, AASB 137 Provisions, Contingent Liabilities and Contingent Assets requires an entity to disclose the following information: I. Comparative information; II. Unused amounts reversed during the period; III. Additional provisions made during the period; IV. The carrying amount at the beginning and end of the period; V. A brief description of the nature of the obligation and the expected timing. O a. II, III and IV only. O b. I, II, and III only. OC I, III, IV and V only. O d. II, III, IV and V only.