In Relation to Equity Instruments Granted by an Entity Where

question 4

Multiple Choice

In relation to equity instruments granted by an entity where the entity makes modifications to the terms and conditions attaching to the grant,

• A) the incremental fair value is measured as the difference between the fair value of the modified instrument, estimated at the date of modification and that of the original equity instrument, estimated at the date of original granting.
• B) if the modification occurs during the vesting period the incremental fair value is recognised immediately.
• C) terms or conditions may not be modified in a manner that is not beneficial to the employee.
• D) where the exercise price of options is modified, the fair value of the options changes.

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Definitions:

Interest Expense

The financial burden placed on a company due to borrowing funds over a time span.

Income Tax Expense

The cost associated with the taxes levied on the income of a company by the government.

Income From Operations

Income from a company’s principal operating activity; determined by subtracting cost of goods sold and operating expenses from net sales.

Trend Percentage

A comparative analysis technique that calculates the change in financial data over multiple periods to identify patterns or trends.