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CIMAPRA19-F02-1 Exam - Topic 1 Question 50 Discussion

XY puchased 2% of the equity shares of FG on 1 October 20X3.XY paid $25,000 for the shares as well as a transaction cost of 2.5% of the purchase price.The shares are being held for short term trading and XY intend to sell them in December 20X3.At the year end of 31 October 20X3, the shares in FG could be sold for $28,000.What is the journal entry to record the subsequent measurement for this investment at 31 October 20X3?
A) Debit investment in equity shares $3,000 and credit profit or loss $3,000.
B) Debit investment in equity shares $3,000 and credit other reserves $3,000.
C) Debit investment in equity shares $2,375 and credit profit or loss $2,375.
D) Debit investment in equity shares $2,375 and credit other reserves $2,375.

CIMAPRA19-F02-1 Exam - Topic 1 Question 50 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam
Question #: 50
Topic #: 1
[All CIMAPRA19-F02-1 Questions]

XY puchased 2% of the equity shares of FG on 1 October 20X3.

XY paid $25,000 for the shares as well as a transaction cost of 2.5% of the purchase price.

The shares are being held for short term trading and XY intend to sell them in December 20X3.

At the year end of 31 October 20X3, the shares in FG could be sold for $28,000.

What is the journal entry to record the subsequent measurement for this investment at 31 October 20X3?

Show Suggested Answer Hide Answer
Suggested Answer: A

by Helaine at May 03, 2022, 09:00 AM

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Juliann
10 months ago
$2,375? That seems low for the potential gain!
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Stevie
10 months ago
Definitely going with option C for the journal entry!
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Merlyn
11 months ago
Wait, why would you credit other reserves? That seems off.
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Michal
11 months ago
I think the profit should be recognized in profit or loss.
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Jackie
11 months ago
XY paid $25,000 plus 2.5% transaction cost.
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Delbert
11 months ago
This is a tricky one. I know Cloud Pak for Watson AlOps is an IBM product, but I'm not too familiar with its specific features. I'll have to eliminate the options that don't seem to fit and then make an educated guess on the remaining ones.
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Brandee
11 months ago
Ah, I know this one! The schedule network diagram is the right answer. It's the only format that shows both the project logic and the critical path activities.
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Honey
11 months ago
I'm a little confused by the wording of the question. Is it asking about the definition of the transformation process itself, or the end state that the transformation is trying to achieve? I'll need to re-read the options more closely to figure this out.
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Clemencia
11 months ago
Okay, let me break this down. The question is asking about the minimum role required to view confidential data, so I'll need to consider the access levels of each role.
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Jeffrey
11 months ago
This is a tricky one. I'm not entirely sure, but I'm leaning towards option A since it mentions a functional consequence, which seems relevant to a functional relationship.
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