Which of the Following Is Not Correct Regarding IAS 39,International

question 34

Multiple Choice

Which of the following is not correct regarding IAS 39,International Accounting Standard 39,"Financial Instruments: Recognition and Measurement," and SFAS No.140,Statement of Financial Accounting Standards No.140,"Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities: A Replacement of FASB Statement No.125"?

• A) IAS 39 represents a principles-based approach to standard setting.
• B) SFAS No.140 represents a principles-based approach to standard setting.
• C) SFAS No.140 represents a rule-based approach to standard setting.
• D) In the large majority of cases,application of the two standards will result in the same accounting treatment for a receivable transfer.

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Definitions:

Production Function

A mathematical model describing the relationship between input factors (like labor and capital) and output, indicating how much can be produced with given resources.

Supply Function

A mathematical relation showing the quantity of a good that producers are willing and able to sell at different prices, holding other factors constant.

Factor Price

The price paid for the use of a factor of production, such as labor, land, or capital.

Production Function

A mathematical model that describes the relationship between input factors of production (like labor and capital) and the output of goods or services that result.