If the ownership of a closely held company is less than 50% of the outstanding stock, then the ownership is termed a: Question 20 options: a) minority interest. b) marketable asset. c) block asset. d) blockage discount. e) majority interest.
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- Based on the presumption in IAS 27, the cost method is applied for equity securities when the percentage of ownership of another company is: Select one: A. 20% to 50%. B. Exactly 100%. C. Less than 20%. D. Over 50%.Which of the following stock investments should be accounted for using the fair value method? a.investments between 20% and 50% ownership b.investments of less than 20% ownership c.investments of over 50% ownership d.all investments of less 50% ownership1. When share options granted vest base on a service condition a. Total fair value of the share options granted > Total compensation expense recognized over the vesting period b. Share options outstanding balance at the end of first year is not equal to Compensation Expense for first year c. Total fair value of the share options granted = Total compensation expense recognized over the vesting period d. Share options outstanding balance at the end of second year is equal to Compensation Expense for second year 2. When share appreciation rights are granted to employees a. expense, liability and equity accounts are recognize b. expense and equity accounts are recognize c. expense and liability accounts are recognize d. liability and equity account are recognized 3. Provided the specified vesting conditions, if any, are met, share-base payment arrangement is an arrangement between an entity and another party that entitles the other party to receive a. Cash or…
- 9. Multiple Choices The corporation has the option to repurchase the preferred stock at a specified price. a. redeemable b. cumulative c. convertible d. compound e. callable f. treasuryWhich of the following statement about a rights issue is correct? a. The share price can be expected to increase on the ex-rights date b. On the ex-rights date the rights separate from the share c. The subscription price is usually greater than the market price d. A rights issue is offered to an investor whether they are an existing shareholder or not e. If you buy shares cum-rights you are not entitled to participate in the rights issue1. Under IFRS 2 Share-Based Payment, what is the basis for measurement of share options? A. Fair value at the date of grant. B. Fair value at each reporting date. C. Expected fair value at the date pf exercise. D. Intrinsic value at each reporting date. 2. Under IFRS 2, Share-Based Payment, the value of the options that lapse after vesting shall A. be credited to expense during the period the options lapse. B. be credited to income during the period that the options lapse C. remain in equity. D. be converted into a liability. 3. When should the compensation expense be recorded as a result of share options granted by the enterprise to its employees?A. During the year of grant B. During the year that the options ultimately vest C. During the years when services are required to be rendered by the employees D. During the year when the option first becomes exercisable
- If shares are issued for a non-cash asset, the share should be recorded at? a. Zero b. Fair market value c. Par or stated value d. CostWhich of the following statements is true in relation to the call price of preference shares? The call price is used in computing book value per share. In the absence of call price, the liquidation value is disregarded and the par or stated value is instead used. The call price is the amount paid to preference shareholders upon redemption of preference shares during the lifetime of the entity. All of these statements are true.13. Options and warrants are dilutive if a. The exercise price is lower than the average market price b. The exercise price is higher than the average market price c. The exercise price is equal to the average market price d. The option shares represent 20% of the ordinary shares actually outstanding 14. For employee share options, the exercise price shall include a. Fair value of the share options b. Intrinsic value of the share options c. Carrying amount of the share options d. Par value of the share options 15. It is a reduction in earnings per share or an increase in loss per share resulting from the assumption that convertible instruments are converted, that options or warrants are exercised, or that ordinary shares are issued upon the satisfaction of specified conditions. a. Dilution b. Antidilution c. Either dilution or antidilution d. Neither dilution nor antidilution
- 22. Acovered call position is: a. the simultaneous purchase of the call and the underlying asset. b. the purchase of a share of stock with a simultaneous sale of a put on that stock. c. the short sale of a share of stock with a simultaneous sale of a call on that stock. d. the purchase of a share of stock with a simultaneous sale of a call on that sstock. e. the simultaneous purchase of a call and sale of a put on the same stock.When share options granted vest base on a service condition (ifrs2) a. Total fair value of the share options granted > Total compensation expense recognized over the vesting period b. Share options outstanding balance at the end of first year is not equal to Compensation Expense for first year c. Share options outstanding balance at the end of second year is equal to Compensation Expense for second year d. Total fair value of the share options granted = Total compensation expense recognized over the vesting periodUpon exercising share options, the resulting increase in the additional paid-in capital would be equal to a. The difference between the fair value of the shares and the par value of the shares, plus the fair value of the share options b. The difference between the exercise price and the par value of the shares c. The difference between the fair value of the shares and the par value of the shares d. The difference between the exercise price and the par value of the shares, plus the fair value of the share options
