Financial instruments

Question 1

What would bonds held until maturity be classified as?

Answer 1

Amortized cost

Question 2

How will financial assets that are considered RPT will be initially recorded if they are not traded in an active market

Answer 2

They will be initially recorded at cost

Question 3

What are transaction costs and give me examples

Answer 3

Transaction costs are incremental costs directly attributable to the acquisition of the financial asset. This would include legal fees, administrative costs and broker fees.

Question 4

What do you do with transaction costs for an investment at FVTPL

Answer 4

You expense them immediately