Under the Requirements of the IASB Conceptual Framework How Would

question 60

Multiple Choice

Under the requirements of the IASB Conceptual Framework how would convertible notes be classified in the statement of financial position?

• A)They have the essential characteristics of debt and, using the principle of prudence, would be classified as a liability.
• B)They would be classified in a separate category between liabilities and equity.
• C)They would be classified as either liabilities or equity at any balance date based on the probability at that time that the notes would, or would not, be converted.
• D)They have the essential characteristics of shares and, using the principle of substance over form, they would be classified as equity.

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Definitions:

Measure Of Dispersion

An indication of how spread out the values of a dataset are, which can include range, variance, or standard deviation.

Standard Deviation

A statistical measure of the dispersion or variability in a set of values, indicating how much the values deviate from the mean of the set.

Standard Deviation

A measure of the dispersion or spread in a set of data; it shows how much variation there is from the average.

Government Agency

An organization at the national, state, or local level that administers specific functions or services to the public.