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ACTG 2P32 Quiz: sharecapital

3 Pages
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Department
Accounting
Course Code
ACTG 2P32
Professor
Parunchana Pacharn

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Share Capital
ASPE (sections 3240,3856)
IFRS (IAS 1)
Nature
share capital is the nominal
value of issued shares (that
is, the sum of their par
values, as indicated on share
certificates
Recognition
When a company redeems
or acquires its own shares,
the cost will usually be
different from their par,
stated or assigned values.
Since such transactions are
clearly capital transactions,
this difference will be
excluded from the
determination of net income
No explicit guidance
is given, although the
accounting may end up
the same due to basic
principles.
Measurement Initial
When a company acquires
its own shares, the shares
shall be carried at cost and
shown as a deduction from
shareholders' equity until
cancelled or resold
No explicit guidance is
given;
Transaction Costs
Transaction costs are
incremental costs that are
directly attributable to the
acquisition, issue or disposal
of a financial asset or
financial liability. An
incremental cost is one that
would not have been
incurred if the entity had not
acquired, issued or disposed
of the financial instrument.
Transaction costs include
expenditures such as legal
fees, reimbursement of the
lender's administrative costs
and appraisal costs
associated with a loan.
Transaction costs do not
include financing fees, debt
premiums or discounts.
Transaction costs include
fees and commission paid to
agents (including employees
acting as selling agents),
advisers, brokers and
dealers, levies by regulatory
agencies and security
exchanges, and transfer
taxes and duties. Transaction
costs do not include debt
premiums or discounts,
financing costs or internal
administrative or holding
costs
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Description
Share Capital ASPE (sections 3240,3856) IFRS (IAS 1) Nature share capital is the nominal value of issued shares (that is, the sum of their par values, as indicated on share certificates Recognition When a company redeems No explicit guidance or acquires its own shares, is given, although the the cost will usually be accounting may end up different from their par, the same due to basic stated or assigned values. principles. Since such transactions are clearly capital transactions, this difference will be excluded from the determination of net income Measurement Initial When a company acquires No explicit guidance is its own shares, the shares given; shall be carried at cost and shown as a deduction from shareholders equity until cancelled or resold Transaction Costs Transaction costs are Transaction costs include incremental costs that are fees and commission paid to directly attributable to the agents (including employees acquisition, issue or disposal acting as selling agents), of a financial asset or advisers, brokers and financial liability. An dealers, levies by regulatory incremental cost is one that agencies and security would not have been exchanges, and transfer incurred if the entity had not taxes and duties. Transaction acquired, issued or disposed costs do not include debt of the financial instrument. premiums or discounts, Transaction costs include financing costs or internal expenditures such as legal administrative or holding fees, reimbursement of the costs lenders administrative costs and appraisal costs associated with a loan. Transaction costs do not include financing fees, debt premiums or discounts.
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