Elton Industries, a Company Who Uses IFRS Reporting Standards, Has

question 154

Multiple Choice

Elton Industries, a company who uses IFRS reporting standards, has assets and liabilities of a disposal group classified as held-for-sale shown on its statement of financial position. Which of the following presents the best treatment for these?

• A) These assets and liabilities should be netted and presented as a single amount - either a current asset or a current liability on the statement of financial position.
• B) On the balance sheet, the disposal group assets should be shown separately from other assets, while the disposal group liabilities should be shown separately from other liabilities.
• C) The assets and liabilities should be netted and presented as a deduction from equity on the statement of financial position.
• D) There should be no separate disclosure of these assets and liabilities on the statement of financial position.

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Definitions:

Direct Method

A approach used in cash flow statement preparation that lists all major operating cash receipts and payments for the period, directly showing sources and uses of cash.

Investing Activities

Transactions involving the acquisition or disposal of long-term assets and investments, as part of a company's cash flow statement.

Income from Operations

the profit generated from a company’s core business operations, excluding income from investments, taxes, and extraordinary items.

Net Cash Flows

The difference between cash inflows and outflows from operating, investing, and financing activities during a specific period.