State the accounting guidelines for derivative financial instruments.

Q: How do IFRS and U.S. GAAP differ with respect to the classification of debt that is expected to be…

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Q: FASB Statement No. 133 requires that all derivative financial instruments be reported at their: a.…

A: Derivatives are a form of financial instruments which changes their value with change in interest…

Q: , IFRS Financial Instruments One of the following is not within the scope of the standard

A: The scope of the standard applies to all financial instrument except: 1. Interest associated with an…

Q: Explain how to account for the impairment of an available-for-sale debt investment.

A: Debt Investment:   A debt investment involves loaning out the money to an institution in exchange…

Q: Briefly differentiate between Sukuk and Bonds from asset ownership, investment criteria, issue price…

A: The question is based on the concept of investment in Sukuk and bond. Sukuk is consider as a special…

Q: Which of the following loan commitments are within the scope of IPFRS 9? * Loan commitments that the…

A: the following loan commitments are within the scope of IPFRS 9:: Loan commitments that can be…

Q: How is Collateralized debt obligation created. Plelase explain in details

A: Collateralized debt obligation (CDO): Collateralized debt obligation (CDO) is the bundle of loans…

Q: Identify the underlying characteristics of debt instruments and describe the basic approach to…

A: Debt:   It refers to the money that is owed or due to outsiders by the organization.

Q: when is stated interest rate of a debt instrument presumed to be fair?

A: Financial instruments are the contract those are traded in the market. the primary financial…

Q: Define  debt investment.

A: Debt Investment: Debt Investment considered as Lending money on loan to the issuing entity. The main…

Q: financial asset at fair value through profit or loss a. a non derivative equity instrument b. all…

A: Solution: The following may be classified as a financial asset at fair value through profit or loss:…

Q: What is meant by the term “underlying” as it relates toderivative financial instruments?

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Q: Define CDO, collateralized debt obligation

A: The question is based on the structure and definition of Collateralized debt obligation (CDO), the…

Q: Briefly describe some of the similarities and differences between GAAP and IFRS with respect to the…

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Q: GAAP requires that debt issue costs be recorded separately and amortized over the term of the…

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Q: describe the fi nancial statement presentation of and disclosures relating to debt

A: A single line component of the cumulative amount of a long-term firm's liability due after one year…

Q: what reporting categories are used to account for debt investments?

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Q: Explain a debt instrument against the following criteria: Pricing conventions/Rules Seniority

A: The debt instruments refer to the financial instruments, which provide the debt funds to the…

Q: How to record purchase of a  debt investment? Give an example.

A: Journal entry: Journal entry is a set of economic events which can be measured in monetary terms.…

Q: Describe the Debt Investments Classified as Available-for-Sale Securities.

A: Available for sale securities are generally stated at their fair values. These types of securities…

Q: Differentiate between marketable securities held for operating (transactions) purposes and…

A: Marketable securities are short-term liquid Assets that can be liquidated to cash quickly. These…

Q: Which of the following may be classified as a financial asset at fair value through profit or loss?…

A: Solution: The following may be classified as a financial asset at fair value through profit or…

Q: Explain principal (debt)

A: Debt is the amount owed by the company for a particular period from the date of the company's…

Q: Explain Types of Debt Instruments

A: Answer: Debt instrument is like a tool a company may use in capital raising. It allows the holders…

Q: What is the structure of Collateralized debt obligation. Please explain in details

A: A collateralized debt obligation also known as CDO is a complex structured credit product which is…

Q: Explain how to account for the impairment of held-to-maturity debt security.

A: Held to maturity securities are those securities which are purchased to be held till maturity…

Q: How does IFRS differ from U.S. GAAP with respect to using the equity method?

A: Equity method:

Q: Describe the basic methods of debt financing?

A: Every company has two major types of financing one is through raising equity shares and the other is…

Q: Explain an example how to record the purchase of debt investment.

A: When a debt investment is purchased , it is recorded as a asset in the books of the company as it is…

Q: Which of the following may be measured subsequently at amortized cost? a. A derivative b. A…

A: Solution: A derivative and non derivative equity instruments are held for trading and measured at…

Q: Investment in debt instruments classified as FA@FVTOCI recognizes which of the following in OCI? a)…

A: (a) Changes in fair value is the correct answer.

Q: Define embedded rate (for debt)

A: An embedded option is the component of financial security the gives the issuer of the debt option or…

Q: Which of the following items would most likely be classifi ed as a fi nancing activity? A . Issuance…

A: Financing activities are a major part of any entity. These activities are correlated to the issuance…

Q: Demonstrate how to identify and account for debt investments classified forreporting purposes as…

A: A debt security is a type of investment tool in which the bonds are issued by a corporation or the…

Q: Describe the key characteristics of a debt investment and demonstrate how to account for a purchase…

A: Debt Instrument:   A debt instrument is a financial instrument that enables the issuer of the…

Q: Define debt service requirements

A: Debt service requirement is very much essential for a company if it wants to maintain a good credit…

Q: Identify special reporting issues related to derivative financial instruments that cause unique…

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Q: Identify and explain the three types of classifications forinvestments in debt securities.

A: Debt securities: Debt security is money borrowed at a specific rate of interest which must be repaid…

Q: On a balance sheet, what valuation must be reported for debt securities classified as…

A: Balance sheet: A balance sheet prepared after the income statement represented organization assets,…

Q: Which of the following may be measured subsequently at amortized cost? A. non-derivative debt…

A: Solution: "Non-derivative debt instrument" may be measured subsequently at amortized cost.

Q: Identify and describe the principal kinds of debt securities.

A: Business needs funds to operate the activities. Issuing securities is one of the ways to collect the…

Q: Discuss the risks posed by credit derivative contracts and standby letter of credit.

A: Credit derivative is referred to as the financial contract, which used to allow the parties for…

Q: A credit derivative allows creditors and debtors to _________ their exposure to credit risk. For…

A: A credit derivative is a financial contract that allows the parties to minimize their exposure to…