Question 6 1.5 pts Assume the IFRIC 3 model with revaluation is applied. The carrying amount of the ETA asset at 30 June 20X1 is: $105 000 $63 000 $NIL $60 000 Question 7 1.5 pts Assume the IFRIC 3 model with revaluation is applied. In relation to the emission trading scheme Brown would recognise in other comprehensive income for the year ended 30 June 20x1: $5000 O SNIL $3000 $55 000 D Question 8 1.5 pts The application of the IFRIC 3 model with revaluation will result in: no accounting mismatch a mismatch in the statement of financial position only a mismatch in both the statement of other comprehensive income and the statement of financial position a mismatch in the statement of profit or loss and other comprehensive income only Question 9 1.5 pts Alpha Ltd has a debt covenant that limits the amount it can borrow to 50% of its tangible assets. According to agency theory, if Alpha Ltd's actual value for that ratio is approaching 50%, which accounting treatment would management prefer? Reclassifying interest paid as a financing activity Switching from the straight-line depreciation to reducing balance method Upward revaluation of property, plant and equipment Increasing the provision for warranty expenses Question 10 1.5 pts If a securities market is efficient in the semi-strong form: O gains could be made systematically from charting O prices would react slowly to the release of new information securities prices would reflect information reported in financial statements O gains could not be made systematically by trading on private information Part A 20 MCQ each question is worth 1.5 marks This following information relates to questions 1 to 8. On 1 July 20X0 Brown Ltd was awarded emission trading allowances (ETA) for a total of 5000 metric tonnes (MT) at no cost. The ETAs may be used to settle obligations arising from emissions during the years ended 30 June 20X1 and 30 June 20X2. Obligations for emissions during each year ended 30 June are settled one month later on 31 July. ETAs can be traded on the market. The following information about the market price of ETAs is available: 1 July 20X0 $20.00 per MT 30 June 20x1 $21.00 per MT 31 July 20X1 $21.50 per MT Question 6 1.5 pts Assume the IFRIC 3 model with revaluation is applied. The carrying amount of the ETA asset at 30 June 20X1 is: $105 000 $63 000 $NIL $60 000 Question 7 1.5 pts Assume the IFRIC 3 model with revaluation is applied. In relation to the emission trading scheme Brown would recognise in other comprehensive income for the year ended 30 June 20x1: $5000 O SNIL $3000 $55 000 D Question 8 1.5 pts The application of the IFRIC 3 model with revaluation will result in: no accounting mismatch a mismatch in the statement of financial position only a mismatch in both the statement of other comprehensive income and the statement of financial position a mismatch in the statement of profit or loss and other comprehensive income only Question 9 1.5 pts Alpha Ltd has a debt covenant that limits the amount it can borrow to 50% of its tangible assets. According to agency theory, if Alpha Ltd's actual value for that ratio is approaching 50%, which accounting treatment would management prefer? Reclassifying interest paid as a financing activity Switching from the straight-line depreciation to reducing balance method Upward revaluation of property, plant and equipment Increasing the provision for warranty expenses Question 10 1.5 pts If a securities market is efficient in the semi-strong form: O gains could be made systematically from charting O prices would react slowly to the release of new information securities prices would reflect information reported in financial statements O gains could not be made systematically by trading on private information Part A 20 MCQ each question is worth 1.5 marks This following information relates to questions 1 to 8. On 1 July 20X0 Brown Ltd was awarded emission trading allowances (ETA) for a total of 5000 metric tonnes (MT) at no cost. The ETAs may be used to settle obligations arising from emissions during the years ended 30 June 20X1 and 30 June 20X2. Obligations for emissions during each year ended 30 June are settled one month later on 31 July. ETAs can be traded on the market. The following information about the market price of ETAs is available: 1 July 20X0 $20.00 per MT 30 June 20x1 $21.00 per MT 31 July 20X1 $21.50 per MT
