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Hello Sir ,for past year exam paper Dec 2014
Section A
Q1
as the answer is A ,is it mean that other option(B,C,D) is accounting estimate under IAS 8?Q2
why the (i) and (iv) is not part of the answer which is A(all four)? why these two no need to considered for diluted EPS?Q7
why answer(c) is not an asset?Q13
“EPS takes into account the additional resources made available to earn profit when new shares are issued for cash, whereas net profit does not”Do not understand what it’s means
Q18
the increase in interest rate will affect which asset?for impairmentThank you.
Hi,
Q1. Yes, the others must then be changes in accounting estimate
Q2. We only consider share options and convertible debt for diluted EPS.
Q7. It does not meet the definition of an asset, so either it is not a resource that we control or it does not bring in economic benefit.
Q13. Net profit is a measure of what an entity has generated through sales less costs, but does not consider the resources used to fund it, whereas EPS does as it looks at the same figure (net profit) but looks at the number of shares and therefore the amount generated per share. The more resources generated (equity finance) the more shares there would be in issue and we’d expect to see a relative increase in EPS, whereas net profit would not show this as it would just increase without showing the additional resources.
Q18. I’ve not got the paper to hand and can’t answer this one based on what you’ve said, sorry.
Thanks
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