• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

Congratulations to Jamil from Pakistan and Jeeva from Malaysia - Global Prize winners!
see all ACCA December 2022 Genius Hunt Competition winners >>

Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>

Financial instrument

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Financial instrument

  • This topic has 4 replies, 3 voices, and was last updated 5 months ago by fredymaila.
Viewing 5 posts - 1 through 5 (of 5 total)
  • Author
    Posts
  • June 30, 2022 at 9:07 am #659658
    thanh123
    Member
    • Topics: 44
    • Replies: 30
    • ☆☆

    Hi tutor, I have a question about transaction cost of financial instrument.

    (1): Financial asset, Transaction cost is added.

    (2): Financial equity, liability: Transaction costs are deducted.

    I hope to receive your explanation. Thanks tutor !

    July 1, 2022 at 3:27 pm #659750
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6453
    • ☆☆☆☆☆

    Correct! The only time you need to be careful is when you have a financial asset at fair value through profit or loss. In this instance the costs are expensed through profit or loss.

    Thanks and well done.

    July 3, 2022 at 2:48 am #659818
    thanh123
    Member
    • Topics: 44
    • Replies: 30
    • ☆☆

    Thanks tutor.

    But, I am confused why transaction costs are deducted on financial equity & liability ? I don’t know the core of its.

    July 5, 2022 at 9:38 pm #660033
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6453
    • ☆☆☆☆☆

    Think back to debits and credits. We are paying the transaction fee regardless of whether it is related to a financial asset or financial liability, so it will always be a CR Bank entry. The key is what we are doing with the debit entry:

    Financial asset – DR Financial asset and debits increase assets, hence it being added

    Financial liability – DR Financial liability and credits decrease liabilities, hence it being deducted.

    Hope that helps clear it up.

    Thanks

    August 23, 2022 at 1:09 pm #664052
    fredymaila
    Member
    • Topics: 48
    • Replies: 100
    • ☆☆

    P2-D2 wrote:Think back to debits and credits. We are paying the transaction fee regardless of whether it is related to a financial asset or financial liability, so it will always be a CR Bank entry. The key is what we are doing with the debit entry:

    Perfect sir.

  • Author
    Posts
Viewing 5 posts - 1 through 5 (of 5 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA My Exam Performance for non-variant Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

FREE Verifiable CPD for ACCA Members

ACCA mock exams and debrief videos

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Latest comments

  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • douglasnyangara on Foreign exchange risk management (1) Part 4 – ACCA (AFM) lectures
  • AnnaTeddy on Basic group structures – SPLOCI introduction and example – ACCA (SBR) lectures
  • tanyanti on Conceptual Framework – ACCA SBR lecture
  • John Moffat on Statement of Cash Flows (part b) Example 1 – ACCA Financial Accounting (FA) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in


We use cookies to show you relevant advertising, find out more: Privacy Policy · Cookie Policy