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    Question

    Which of the following methods will be used to classify

    an investment in debt instrument for which the company has intention to receive contractual cash flows and for which, the debt gives contractual cash flows for principal and interest?
    A Fair Value through P & L Correct Answer Incorrect Answer
    B Fair Value through OCI Correct Answer Incorrect Answer
    C Amortized cost method Correct Answer Incorrect Answer
    D Market value method Correct Answer Incorrect Answer
    E Depends on the management discretion Correct Answer Incorrect Answer

    Solution

    Financial assets held: §  to collect contractual cash flows and §  represent the financial asset of cash flows that are solely payments of principal and interest on the principal amount outstanding Treatment ·       initially measured at fair value and ·       subsequently at amortised cost

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