CAF-6 · Chapter 2 · Question 8 of 15
Epsilon Co issues a financial liability that will be measured at amortised cost. At initial recognition, how should the transaction costs be treated?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Deducted from the initial fair value of the financial liability.
Explanation
At initial recognition, a financial liability measured at amortised cost is recorded at fair value minus transaction costs.
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