Rudd Ltd Has a Passive Investment in Burke Ltd

question 28

Multiple Choice

Rudd Ltd. has a passive investment in Burke Ltd. Rudd has elected to treat Burke as a fair value through other comprehensive income (FVTOCI) investment under IFRS 9 Financial Instruments. Which of the following statements is true?

• A)Dividends from Burke are reported as other comprehensive income in Rudd's statement of comprehensive income (SCI).
• B)Dividends from Burke are reported as a line item on Rudd's statement of financial position.
• C)Year-to-year changes in the fair value of the investment in Burke are reported as net income in Rudd's SCI.
• D)Accumulated gains and losses in the fair value of investment in Burke should be reported as a separate component in Rudd's shareholders' equity on the statement of financial position.

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