CAF-6 · Chapter 2 · Question 7 of 15
Delta Ltd acquires a financial asset and correctly classifies it as fair value through profit or loss (FVPL). How should the transaction costs associated with acquiring this asset be treated?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Expensed immediately in profit or loss.
Explanation
While transaction costs are added to (or subtracted from) the initial measurement for AC and FVOCI instruments, transaction costs for instruments measured at FVPL are expensed immediately.
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