Question 1: True or False For each of the following false: statements, circle (T or (F) to indicate whether the statement is true or (T) or A mark each (10 marks) (I) (F) D) The primary purpose of the statement of cash flows is to provide cash-basis information about the company's operating, Comment investing, and financing activities. (D (F) A company reconciles net income to net cash now from opernating activities when using the direct method or the indirect method. Comment When prepaid expenses deerease during a period, oupenses on the accrual-asis C are lower than they are on a cash-basis Comment (D (F) When an issuer offers some form of additional consideration (a sweetener) to 4. encourage of its convertible debt, it reports the sweetener as a current period expense. Comment 5.(DF) Contingent assets are not reported in the statement of financial position. Comment 6. 6. (T) (F) Companies recognize a gain or loss when shareholders exercise convertible preference shares. Comment 7. (T) (F) IFRS requires that convertible debt be separated into its liability and equity components for accounting purposes. Comment 8. (T) (F) The issuer of convertible preference shares uses the fair value method to record the conversion of the shares. Comment 9. (F) The effective interest does not go to the income statement. Comment