<"ru 7h" Qr,*** *fu"d "f 6"ro**ffa*a.- TL**y.ol 6ea,.

f*
TA.334: INVESTMENTS - Panr 2 or 2
Sources.' PAS 32IPAS 39/pAS 40/PFR!; $/PFRS 15/Applicable AICPAlVarious test tranks
\
di 1. The contractual agreemeni'between a bondhokJer {investor) anrl a bond issuer (borrower) is contained
in a formal document known as
Bond indenture c. , Bond prerniurn
Bond certificate d. Bond discount
i". 2. What are SERIAL bonrls?
',, t:*.:^1" t,f u' Bonds that qive the hondhakiers the r;ght to exchange their bonds
.'ll for equity shares
F ! I ' : ' - : . i L Bonds that ntay be recleerneti in lry, the rssuing corpclration prior to maturity date
r\_\, @ Bonds that have a series of matulity dafes anct payabte in installments
lf F.i\ d. Bonds that mature c:n a sir:rle date
A 3. Ungsl pl\S 3-9, transaction costs incurred iri acrquiring br:l-1ti investrrients are expensed immetjiately for
rr
@' Trading securities c. l"jeld to maturity securities
b. Available for saie seciurities, d" Ali of the chnlces
,i' 4, These are.investnrents in t-rorrrls carrieci ;rt f*;r value on the bafance sheet <late, with any unrealized gain
' or loss included as a cornponent of g-trf4.gr1 l^oss"
(:d} Trading secr:rities c, tleld to rnaturity securities
b. Auailable for sale secui-ities^ t d. None of tfe.choices
-.
r s. rf an entity faits to *no-61l[ l; li;';;,,l1,u" its trqdirisrt
Itll-l 'rttt'LllLvl \rv'Jt ' 'rli
rhen the income is
L a. overstated ffl Not affected
b. Understated d. "rr"r,]o*nt,
Either overstatc*d or understated
n 6. For an available-for-sale (AFS) lrosd investnrgnt, iihe unrealizeci gain is the excess of
',
i) @ Fair value over grigin,qlgost !. i . :ii{l . orrginar cost over fair value
b. Fair value over amortized cost d. Amoi-tizecj cost over fair value
i) '7. Br:nd investments classified as heirJ {o rnatuiitv (HTM) securities are generally carried at
a. Fair value, with any r-rnrealrzed eain rrr loss included as a r:onr[onent of income
L'. Fair value, with any unrealized qain ..,r h:ss included as a component of equity
c- Amortized cost, with any premiurn clr discourrt anrortized using straight-line method
ifl Amortized cost,'aritlr ahi pren:i.rr-n rr ciis<:ount snic!'tized usin[ effedive inteiest method
8. If an investor purchased
li '
of the bond is
a bond Lretwee.o-xtie-[c-:!-.]Qeynl5]nt

a- Less than the far:e r.,aiue ancj

- cash paid to the sel!*r
b. More than the lace value and caslr paid ic, ihe seller
dates at a ptenrium, then the carrying value

q. Less than the face value but more Lhair the cash paid t-o the seller
@ More than the facr: val,-re trut le:;s, rlia,lr i;" .;; ;"i,1 t" tr,- .-ij.-r l*i,,.,"{O 1,*1t-n.
e.' Ir a clebt securtv is rectass;riecl rk:irr ryIy*Gir,* i,i" ainl.enll |"h;l:ii"J:i].i,j?b'J*ounr
L fair value at the date of reclassrficatiolr-E I
a. Not recognized -
and

G RecognizerJ as a cornponent .f e-qyjy *-C',:

b' Recognieed as a crrrnponerrt rrf profit d. Recognized as a component of cash flow

D 10. If a debt secr.rrity is reclassifietl frrtrrt AF:; tQIlrt,)-.u uny previous unrealized gain or loss recognized
directly in equity is
\--:j
a. Recognized as an adjustnrent of retiiinerJ earrrtngs
b. Recognized in profit or loss irrrrnediateill at the date r:f transfer
c. Included in equity and amurtized to profit or loss o..rer the remairiing life of the held to
Included in equity and arnurtizeil to ;:roiit or loss over the remaining life of the held to
maturity security using the, effecrive interest methud

11. Under PFRS 9, a debt instrunrent can be measured ar qmgBlzed_cost if it meets the following
ii"iffi11ectiveoftheentity,sbusines-.qrncrde|iStohold.nmu.o.o**.n".',;.".."",
, cash flows rather than to sell the instr-urnent prior to lts contrautual maturity to realize changes in
its fair value.
.'. ,II) The contractual terlTs of the tlrrancial asset give r.ise on specified clates to cash flows that are solely
payments of principal and interest on the principal arnount cutstanding.
Ill)-TherentXryrtras the positive intention an'J ability,"ri:l*ril? financiat asset untit maturtty,
_ Llrlo rlJ,.,,
b. I and III @, i, ii' ari,r lU 1 'l , l. i d

Paee '! of 3 paqes