Chapter 30 - Financial Instruments: QUESTION 30-11 Multiple Choice (PAS 32)
Chapter 30 - Financial Instruments: QUESTION 30-11 Multiple Choice (PAS 32)
3. A financial liability
a. Must be classified as noncurrent liability.
b. Is a contractual obligation to deliver cash or another financial asset to another
entity.
c. Is a contractual obligation to exchange financial assets or financial liabilities with
another entity under conditions that are potentially favorable to the entity.
d. Is a contractual obligation to deliver cash or any asset to another entity.
4. It is any contract that evidences residual interest in the assets of an entity after deducting all
of the liabilities.
a. Equity instrument
b. Debt instrument
c. Loan and receivable
d. Financial asset with indeterminable fair value
7. How should preference shares that are redeemable mandatorily be presented in the statement
of financial position?
a. Noncurrent financial liability
b. Current financial liability
c. Equity
d. Either current or noncurrent financial liability depending on redemption date
a. A financial asset is recognized when it is probable that future economic benefits will flow to
the entity.
b. A financial asset is recognized when the entity obtains control of the instrument.
c. A financial asset is recognized when the entity obtains the risks and rewards of ownership of
the financial asset.
d. A financial asset is recognized when the entity becomes a party to the contractual
provisions of the instrument.
3. Which of the following financial instruments would not be classified as financial liability?
a. A preference share that must be redeemed by the issuer for cash on a future date
b. A contract for the for delivery of as any of the entity’s ordinary shares as are equal in value to a
fixed amount of cash on a future date
c. A written call option that gives the holder the right to purchase a fixed number of the
entity’s ordinary shares in return for a fixed price
d. An issued perpetual debt instrument
4. Which information is not required to be disclosed about exposure to risk arising from
financial instruments?
a. Information about market risk
b. Information about credit risk
c. Information about operational risk
d. Information about liquidity risk