stalkey

1 is a.
2 is dicey. Generally not permitted to change. But still allowed to only if there is an embedded derivative that is a level 3 asset. Answer should be c, but answer is probably a. Would be recorded in profit and loss and the new cost would be the new value if you could do it.

Changes should 90% of the time go to IS as it is the equivalent of realizing the new cost basis. There are specific examples on not but it is outside the curriculum. My guess is that is what you are confused about?



Edited 1 time(s). Last edit at Sunday, May 16, 2010 at 06:35PM by Paraguay.