Which statement/s is/are correct? SI ABC, a manufacturer of appliances, approved to insure a customer for any loss or damage that the customer may incur from the use of a purchased appliance which is covered under PFRS 17. S2 Under insurance contract, the party that has a right to compensation if the insured event occurs is referred to as the insurer. S3 PFRS permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S4 An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of

Which statement/s is/are correct? SI ABC, a manufacturer of appliances, approved to insure a customer for any loss or damage that the customer may incur from the use of a purchased appliance which is covered under PFRS 17. S2 Under insurance contract, the party that has a right to compensation if the insured event occurs is referred to as the insurer. S3 PFRS permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S4 An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 4GI

See similar textbooks

Similar questions

1. S1: Maker Co, a manufacture and dealer of household appliances, agrees to indemnify a customer of any loss or damage that the customer may sustain from the use of purchase appliance. The contract to indemnify the customer in case of loss event is accounted for under PFRS 15. S2: Under insurance contract, the party that has a right to compensation if the insured event occurs is referred to as the policyholder. Only S1 is correct. Both statements are correct Only S2 is correct. Both statements are incorrect. 2. It is the change in the relation of the partners caused by any partner being disassociated from the business. Dissolution Formation Liquidation Operations 3. If the promise to grant a license is distinct and that the license provides the customer the “right to access” the entity’s intellectual property, how is revenue recognized from the initial fee in the contract? in full when the initial services to setup the contract are substantially performed deferred and…
S1: In accordance with the accrual assumption, the full amount of the premium is recognized immediately as income when received; instead, the premium is normally regarded as being earned evenly over the period of the policy. S2: ABC a manufacturer of appliances, approved to insure a customer for any loss or damage that the customer may incur from the use of a purchased appliance which is covered under PFRS 17.S3: Under insurance contract, the party that has a right to compensation if the insured event occurs is referred to as the insurer. Only S1 is correct O Only S2 is correct O Only S3 is correct O Only S1 is incorrect O Only S2 is incorrect O All statements are incorrect Only S3 is incorrect All statements are correct
S1: In accordance with the accrual assumption, the full amount of the premium is recognized immediately as income when received; instead, the premium is normally regarded as being earned evenly over the period of the policy. S2: ABC a manufacturer of appliances, approved to insure a customer for any loss or damage that the customer may incur from the use of a purchased appliance which is covered under PFRS 17. S3: Under insurance contract, the party that has a right to compensation if the insured event occurs is referred to as the insurer. a. Only S3 is incorrectb. All statements are correctc. Only S2 is correctd. Only S3 is correcte. Only S1 is incorrectf. Only S2 is incorrectg. All statements are incorrect h. Only S1 is correct
15. If an entity gives a product warranty that has been issued directly by a manufacturer, dealer or retailer, which IFRS is likely to cover this warranty? a. IAS 32 Financial instruments - Presentation b. IAS 37 Provisions, contingent liabilities and contingent assets c. IFRS 17 Insurance contracts d. IFRS 9 Financial instruments 16. IFRS 17 provides that insurance contracts should a. Be covered by IAS 32 and IFRS 9 b. Comply with all existing IFRS c. Generally continue to be subject to existing accounting policies. d. Comply with the IFRS Framework document. 17. An insurance contract can contain both deposit and insurance elements. An example might be a reinsurance contract where the cedant receives a repayment of the premiums at a future date if there are no claims under the contract. Effectively this constitutes a loan by the cedant that will be repaid in the future. IFRS 17 requires that a. Each payment by the cedant is accounted for as loan advance and as payment for insurance…
Entity A obtains life insurance for its key employee from Entity B (an insurance company). Entity B cedes the insurance contract with Entity A to Entity C, another insurance company. How should Entity B account for the insurance contract with Entity C?A. using the modified version of the general model applicable for onerous insurance contractsB. using the general modelC. using a modified version of (a) or (b) applicable to reinsurance contracts heldD. using the premium allocation approach
Which of the following types of insurance does NOT involve a contract with an external party? a. self insurance b. directors and officers insurance c. property insurance d. life insurance
3344 An insured who wants to verify the deductible on Section I of their Homeowners policy should look at which of the following sections of the policy? a. declarations b. insuring agreements c. conditions d. limitations
Use the following information for the next three questlons: Entity A, a manufacturing entity, obtains insurance against product liability from Entity B, an insurance company. Entity B then cedes the insurance contact with Entity C, another insurance company. 1. How does Entity B account for the insurance contract with Entity A? General model Premium Allocation Approach Ca or b d. Not accounted for under PFRS 17 How does Entity C account for the insurande contract ceded by Entity B? General model Premium Allocation Approach a or b d. Modification to general model för reinsurance contracts held 3 How does Entity B account for the insurance contract ceded to Entity C General modet Premium Allocation Approach a or Modification to geheral model for reinsurance contracts held
Placing the insured in the same position financially as he or she or it was in immediately before the loss or damage took place. For this purpose, the insurance companies are: a. Paying compensation to the insured b. Paying commission to the insured c. Paying salaries to employees d. Paying commission to the agents
Which of the following is most likely to result in the recognition of a liability? a. Customers become entitled to rebates for their past purchases. b. Intention to acquire inventories in a future period. c. Entering into a purchase contract for future delivery. d. Agreeing on an irrevocable future commitment that is not burdensome at present.
Which of the following sections of a commercial general liability policy contains information about limits of insurance and premiums? Declaration Exclusion Condition Insuring agreement
Which statement/s is/are correct? S1 PFRS permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S2 An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of subsidiaries. S3 PFRS 17 provides discretionary participation features in the insurance contract recognized separately from the guaranteed elements, where the issuer of such contract shall classify that feature as either a liability or a separate component of equity.