Investments (Set 6)

Under PFRS 9, investment in equity securities classified aas financial asset at fair value through profit or loss (preference shares or ordinary shares) is initially measured at ___

Answer explanation

Under PFRS 9, in investment in equity securities classified as financial asset at fair value through profit or loss (preference or ordinary shares), transaction cost is ___

Under PFRS 9, investment in equity securities classified as financial asset at fair value through other comprehensive income (preference or ordinary shares) is initially measured at ___

Answer explanation

Financial asset that is not an FVPL is initially measured like this

FVPL = held for trading

FVOCI = not held for trading

Under PFRS 9, in investment in equity securities classified as financial asset at fair value through other comprehensive income (preference or ordinary shares), transaction cost is ___

Proforma entry of FA at FVPL acquired through cash

Answer explanation

Dr FA at FVPL / FA held for trading

Dr Transaction Cost (expense - P/L)

Cr Cash

Proforma entry of FA at FVOCI acquired through cash

Answer explanation

Dr FA at FVOCI (includes TC)

Cr Cash

Entry for declaration of dividends

(one who declares POV)

Answer explanation

Dr Retained Earnings

Cr Dividends Payable

Entry for Dividends Declared

(one who will receive POV)

Answer explanation

Dr Dividends Receivable

Cr Dividends Income - P/L

Entry for payment of dividends

(one who paid POV)

Answer explanation

Dr Dividend Payable

Cr Cash

Entry for dividends received

(one who received it)

Answer explanation

Dr Cash

Cr Dividend Receivable