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Compound Financial instrument

Financial Reporting

answered on 08-Apr-24 17:25

Sir, During the conversion to equity from bond at year end 4 why we have touched the equity component ( Debited the equity ) . The equity recognized at beginning will remain unchanged know.?

latest answer

The amount is again credited to equity. So in effect to that extent equity is not changed. Its just a reclassification

M V Naresh

M V Naresh

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46

Illustration 35 Indigo Learn Material Interpretation

Financial Reporting

answered on 08-Apr-24 17:26

In class you have taken 5,00,000 amount as liability where they have specified 5,00,000 5% convertible debentures shouldn't we multiply with Face value 10 Rs ?

latest answer

Yes you are right.

M V Naresh

M V Naresh

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46

Deferred Tax

Financial Reporting

answered on 08-Apr-24 17:28

Video No 13 Illustration 3 A Ltd recognises interest income on accrual basis. Interest rate is 25% so DTL is created for 25% But income tax department will tax the same at the rate of 30% when cash is received. On 31st December reporting my entry for 25% is correct. Assuming that I am receiving cash on 6th June or 7th June I have to pay tax to income tax department @ 30% even though last year entry is passed @ 25%. Am I correct. Tax liability to income tax department will not get affected

latest answer

What ever we pay to income tax department will be based on the tax rate applicable. So even if we provide for using 25% and actual rate turns out to be 30%, we will pay at 30% itself.

swaminathan sundaram

swaminathan sundaram

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36

Difference Between Residual value and Fair value

Financial Reporting

answered on 07-Apr-24 08:24

1.Sir u explained that Residual value is the Current market value of the Similar PPE after useful life. 2. If Fair value is more than Residual value we should take residual value - ind as 16 3. My question is what is the difference between Fair value and Residual value bcoz both are current market only sir?

latest answer

Understood , Thank you sir

Vijay Ramesh

Vijay Ramesh

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42

Q2- Embedded Derivatives

Financial Reporting

answered on 10-Apr-24 16:23

Sir, are we not entering into the forward contract and in that case no matter what the spot rate is at, we will have the agreed Forex rate on the settlement date and going by that would not the buyer incur loss as he had to give more INR against USD.. If forward was not entered into, why are we passing entries as forward is live...

latest answer

However, if one party had $ as their functional currency, the case would have been like a normal import transaction.

Venky Balamurali

Venky Balamurali

CA Final

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35

IND AS 116

Financial Reporting

answered on 04-Apr-24 13:46

Sir if lease payments are happening at year beginning, Those payments are also should consider for lease liability ?

latest answer

For liability only unpaid. If you pay something before inception, it is not considered in liability

M V Naresh

M V Naresh

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61

Leases in AS 116 Remeasurement Illustration

Financial Reporting

answered on 10-Apr-24 16:04

Sir in illustration 32 of ICAI why The CPI index was not adjusted for the lease liability table before the date of the Remeasurement ?

latest answer

Changes to CPI after initial measurement will not be considered. If there is modification etc, then it will be considered.

M V Naresh

M V Naresh

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39

Balance Sheet Approach

Financial Reporting

answered on 02-Apr-24 18:16

Sir, is IND AS-12 Mandatorily focuses on Balance sheet approach? or as it is easy to understand you have emphasized to used it ?

latest answer

Mandatory

Surya Prakash

Surya Prakash

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73

Deferred Tax Video lecture No 4

Financial Reporting

answered on 02-Apr-24 09:53

When rent received in advance how to create DTA and DTL is explained. Assuming that I am receiving rent advance of Rs 500000 out of that 50000 is TDS now bank will be debited for Rs 450000 (500000 rent - TDS 50000) Entry is Bank A/c Debit 450000 TDS Debit 50000 To Rent received in Advance Credit 500000 Now we have to pass JV as DTA Debit 50000 P & L Credit 50000 The above entry is for tax portion Next year this entry will be reversed P & L Debit 50000 DTA Credit 50000 Am I correct?

latest answer

DTA is not necessarily equal to TDS. Otherwise the entry is correct.

swaminathan sundaram

swaminathan sundaram

CA Final

110

3

45

Accounting Entries - Examples

Financial Reporting

answered on 01-Apr-24 04:59

In this case - we recognize amount receivable from customer contract asset , but why cant it be treated as sale made with a right to return ?

latest answer

It is similar.

Bhoomi Makhecha

Bhoomi Makhecha

CA Final

35

1

65

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