Concept explainers
A
a. Is not accounted for by the acquirer if the contingent liability has an improbable outflow of economic resources.
b. Is recognized even if it has an improbable outflow of economic resources for as long as there is present obligation and the fair value of the obligation can be measured reliably
c. Is recognized only if there is present obligation, probable outflow of economic resources, and can be measured reliably.
d. Are not accounted for by the acquirer if the contingent liability has an improbable outflow of economic resources and recognized only if there is present obligation, probable outflow of economic resources, and can be measured reliably.
Trending nowThis is a popular solution!
Step by stepSolved in 2 steps
- The risk of an accounting loss from a financial instrument due to possible failure of another party to perform according to terms of the contract is known as: [A] Credit risk [B] Investment risk [C]Market risk [D]Opportunity risk.arrow_forwardIf a company has elected the fair value option, where are gains and losses resulting from adjusting these accounts to fair value reported? Group of answer choices Unrealized Gains are reported as part of Other Comprehensive Income while Unrealized losses are reported as part of Net Income. Unrealized Gains and Losses are both reported as part of Net Income. Unrealized Gains are reported as part of Net Income, while Unrealized Losses are reported as part of Other Comprehensive Income. Unrealized Gains and Losses are both reported as part of Other Comprehensive Income.arrow_forwardUnder IFRS, a provision is the same as: a. a contingent liability. b. an estimated liability. c. a contingent gain. d. None of the above.arrow_forward
- If an entity recognises the revenue associated with a contract with a customer over time (rather than at a point in time), would this approach be considered more conservative than an approach that defers profit recognition until the completion of the contract (that is, at a future point in time)?arrow_forward4. Entity A issues an instrument that is re-purchasable by delivering cash or another financial asset. However, Entity A's and financial liability remain unaltered. delivo 1ssues an instrument that is re-purchasable byarrow_forwardStatement 1: Measurement period is relevant if Fair Value of Net Assets of acquiree includes the recognition of the contingent asset, contingent liability, and assets/liabilities with provisional amounts. Statement 2: Measurement period is relevant for the remeasurement fo all contingent considerations. A. Both Statetements are Correct B. Both Statements are Incorrect C. Only Statement 1 is Correct D. Only Statement 2 is Correctarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education