The June 2005 Exposure Draft Issued in Relation to IAS $\quad$

question 7

Multiple Choice

The June 2005 exposure draft issued in relation to IAS 37 proposed changes to: I $\quad$ the name of the standard
II $\quad$ recognition and measurement criteria
III $\quad$ the definition of contingencies
IV $\quad$ the method of disclosure for provisions

• A) I, II and III
• B) II, III and IV
• C) I, III and IV
• D) I, II and IV

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Definitions:

Profitability Index

A financial metric used to evaluate the desirability of an investment, calculated as the present value of future cash flows divided by the initial investment.

Present Value

A calculation that determines the current value of a future amount of money or stream of cash flows given a specified rate of return.

Cash Inflows

Money received by a business from its operational activities, investments, or financing.

Salvage Value

Salvage value refers to the expected value an asset will have when it's no longer useful, essentially its end-of-life resale value.