By Applying the Definition Provided in IAS 21 the Effects

question 19

Multiple Choice

By applying the definition provided in IAS 21 The Effects of Changes in Foreign Exchange Rates, the following items will be regarded as a monetary item:

• A) property, plant and equipment;
• B) land and buildings;
• C) inventory;
• D) accounts receivable.

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Definitions:

Equity Multiplier

A financial leverage ratio that measures the portion of a company's assets that are financed by shareholder's equity.

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without increasing its financial leverage or debt proportion.

Dividend Payout Ratio

The proportion of net income a firm pays out to its shareholders in the form of dividends.