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1.The effective interest rate on bond is lower than the stated rate when bond sells* Below face amount At face amount At maturity value Above

1.The effective interest rate on bond is lower than the stated rate when bond sells*

Below face amount

At face amount

At maturity value

Above face amount

2.Investment property includes all of the following, except*

Land held for long-term capital appreciation

Land held for currently undetermined use

Building owned bu the reporting entity or held by a finance lessee leased out under an operating lease.

Property held for sale in the ordinary course of business

3.Which statement is true about the interest method?*

Amortization of discount decreases each period

The interest method does not use a constant rate

The interest method applies the effective interest rate to the beginning carrying amount

Amortization of premium decreases each period

4.Which statement best describes investment property?*

Property held for sale in the ordinary course of business

Property held for use in the production and supply of goods or services and property held for administrative purposes

Property held to earn rentals or for capital appreciation

Property held for capital appreciation

5.If the entity uses the fair value model for investment property, which statement is true?*

The entity depreciates the equipment using normal depreciation method

The entity should report the increase in fair value in other comprehensive income for the period.

The entity should value the property at cost less accumulated depreciation and impairment.

The entity does not record depreciation on the investment property.

6.Which additional disclosure must be made when an entity chooses the cost model?*

The fair value of the property

The present value of the property

The value in use of the property

The net realizable value of the property

7.Which statement is true when a debt investment at FVOCI is reclassified to amortized cost?*

The fair value at reclassification date becomes the new carrying amount.

The cumulative gain or loss previously recognized in OCI is removed from equity and adjusted against the fair value at reclassification date.

All these statements are true.

The original effective rate is not adjusted.

8.Trading bond investments are reported at*

Maturity value

Amortized cost

Fair value

Face amount

9.If an entity owns and manages a hotel and services provided to guests are a significant component of the arrangement as a whole, the hotel is classified as*

Neither investment property nor owner-occupied property

Owner-occupied property

Investment property

Partly investment property and partly owner-occupied property

10. The fair value option allows an entity to*

All of these statements are correct

Report most financial instruments at fair value

Record income when the fair value increases

Measure bond investments at fair value in some years

11. Which statement is true when a debt investment at amortized cost is reclassified to FVOCI?*

The difference between the previous carrying amount and fair value at reclassification date is recognized in other comprehensive income.

The debt investment is measured at fair value at reclassification date.

All these statements are true.

The original effective rate is not adjusted

12. Which of the following is an investment property?*

Property that is being constructed and developed as investment property

Property held for future development and subsequent use as owner-occupied property

Owner-occupied property awaiting disposal

Property being constructed or developed on behalf of the third party?

13. An investment property is derecognized when*

It is disposed to a third party

It is permanently withdrawn from use

No future benefits are expected from the disposal

In all of these cases

14. Debt investments that meet the business model and contractual cash flow tests are reported at*

The lower of amortized cost and fair value

Net reliable value

Amortized cost

Fair value

15. The interest rate written on the face of bond is known as*

Nominal rate

Nominal rate, coupon rate or stated rate

Coupon rate

Stated rate

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