FAR Pre-Board Exam - FAR Pre-Board Exam PDF

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FAR Pre-Board Exam 1. The Financial Reporting Standards Council was created thru the enactment of a. RA 9184 b. RA 9298 c. RA 10964 d. None of the above The International Accounting Standards Board (IASB) is a/ana. Non-independent accounting standard setter b. Government entity which seeks out to se...

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F ARPr e Bo a r dEx a m 1 . Th eF i n a n c i a l Re p o r t i n gSt a n d a r d sCo u n c i lwa sc r e a t e d t h r ut h ee n a c t me n t o f a . RA9 1 8 4 2 9 8 b . RA9 c . RA1 0 9 6 4 d . No n eo f t h ea b o v e 2 . Th eI n t e r n a t i o n a lAc c o u n t i n gSt a n d a r d sBo a r d( I ASB)i s a / a n a . No n i n d e p e n d e n t a c c o u n t i n gs t a n d a r ds e t t e r b . Go v e r n me n te n t i t ywh i c hs e e k so u tt os e ta n d e n f o r c es t a n d a r d sf o ra c c o u n t i n gp r o c e d u r e s c . Or g a n i z a t i o n s u c c e e d e d b y t h e I ASC ( I n t e r n a t i o n a l Ac c o u n t i n g St a n d a r d s Co mmi t t e e ) d . No n eo f t h ea b o v e 3 . Po s t i n g a . Ac c u mu l a t e st h ee ff e c t so fl e d g e re n t r i e sa n d t r a n s f e r t h e mt ot h eg e n e r a l j o u r n a l b . Do n eo n c ee v e r yy e a r c .T r a n s f e r sj o u r n a l e n t r i e st ot h el e d g e r a c c o u n t s d . Do n eo n l yf o r i n c o mes t a t e me n t a c t i v i t y 4 . No mi n a l a c c o u n t sa r ea l s oc a l l e d a . Mi x e da c c o u n t s b . Re a l a c c o u n t s c . Pe r ma n e n t a c c o u n t s e mp o r a r ya c c o u n t s d .T 5 . Re v e n u ei s a .I mp a c t e db yd e b i tc r e d i ti nt h es a mewa yt h a t e x p e n s e sa r ei mp a c t e db yd e b i t a n dc r e d i t b . As u b d i v i s i o no fe q u i t y ,p r o v i d i n gi n f o r ma t i o n a b o u t wh ye q u i t yi n c r e a s e d c . Re p o r t e di nt h es t a t e me n to ffi n a n c i a lp o s i t i o n a sac u r r e n t i t e m d . Al lo ft h ec h o i c e sa r ec o r r e c t e dr e g a r d i n g r e v e n u e 6 . Ac c o r d i n gt oCo n c e p t u a l F r a me wo r k , v e r i fi a b i l i t yi mp l i e s a .L e g a l e v i d e n c e b .L o g i c c . Co n s e n s u s d .L e g a l v e r d i c t 7 . Wh i c ho f t h ef o l l o wi n gi sn o ta na c c e p t a b l eb a s i sf o rt h e r e c o g n i t i o no f e x p e n s e ? a . Sy s t e ma t i cr a t i o n a l a l l o c a t i o n b . Ca u s ea n de ff e c t a s s o c i a t i o n c .I mme d i a t er e c o g n i t i o n d . Ca s hd i s b u r s e me n t 8 . Th ec o n c e p t u a l f r a me wo r ki n c l u d e swh i c hc o n s t r a i n t ? a . Pr u d e n c e b . Co n s e r v a t i s m s t c . Co

d . Al lo ft h ec h o i c e sa r ec o n s t r a i n t si nt h e c o n c e p t u a l f r a me wo r k

9 . De p o s i t sh e l da sc o mp e n s a t i n gb a l a n c e a . Us u a l l yd on o t e a r ni n t e r e s t b .I fl e g a l l yr e s t r i c t e da n dh e l da g a i n s t s h o r t t e r m c r e d i t ma yb ei n c l u d e da sc a s h c . I fl e g a l l yr e s t r i c t e da n dh e l da g a i n s tl o n g t e r m c r e d i t ma yb ei n c l u d e da mo n gc u r r e n t a s s e t s d . No n eo f t h e s e 1 0 .Wh e nt h ea l l o wa n c eme t h o do fr e c o g n i z i n gb a dd e b t e x p e n s ei su s e d ,t h ee n t r i e sa tt h et i meo fc o l l e c t i o no f a na c c o u n t p r e v i o u s l ywr i t t e no ffwo u l d a . De c r e a s et h ea l l o wa n c ef o r d o u b t f u l a c c o u n t s b .I n c r e a s et h en e t i n c o me c . Ha v en oe ff e c to nt h ea l l o wa n c ef o rd o u b t f u l a c c o u n t s v en oe ff e c t o nn e t i n c o me d . Ha 1 1 .I n t e r i mfi n a n c i a l r e p o r t ss h o u l di n c l u d ea sami n i mu m a . Ac o mp l e t es e t o f fi n a n c i a l s t a t e me n t s o n d e n s e ds e to ffi n a n c i a ls t a t e me n t sa n d b . Ac s e l e c t e dn o t e s c . Ac o n d e n s e ds t a t e me n to ffi n a n c i a lp o s i t i o n a n dac o n d e n s e di n c o mes t a t e me n t d . Ac o n d e n s e ds t a t e me n to ffi n a n c i a lp o s i t i o n a n dac o n d e n s e ds t a t e me n t o f c a s hfl o ws 1 2 .Un d e rt h ed e fi n e db e n e fi t p l a nt h eo b l i g a t i o no f t h ee n t i t y i st op r o v i d et h e a .b e n e fi t st oc u r r e n t e mp l o y e e s b .t h eb e n e fi t st oc u r r e n t a n df o r me re mp l o y e e s c . t h ea g r e e db e n e fi t t oc u r r e n t e mp l o y e e s h ea g r e e db e n e fi tt oc u r r e n ta n df o r me r d .t e mp l o y e e s . 1 3 .As o u n d l yd e v e l o p e dc o n c e p t u a l f r a me wo r ko fc o n c e p t s a n do b j e c t i v e ss h o u l d a .i n c r e a s e fi n a n c i a l s t a t e me n t u s e r s ' u n d e r s t a n d i n go fa n dc o n fi d e n c ei nfi n a n c i a l r e p o r t i n g . b .e n h a n c ec o mp a r a b i l i t ya mo n gc o mp a n i e s ' fi n a n c i a l s t a t e me n t s . c . a l l o wn e wa n de me r g i n gp r a c t i c a l p r o b l e mst o b emo r eq u i c k l ys o l v e d . l l o f t h e s e . d .a 1 4 .Ane x a mp l eo f a ni t e mwh i c hi sn o t al i a b i l i t yi s a .d i v i d e n d sp a y a b l ei ns t o c k . b .a d v a n c e sf r o mc u s t o me r so nc o n t r a c t s . c . a c c r u e de s t i ma t e dwa r r a n t yc o s t s . d .t h ep o r t i o no fl o n g t e r md e b td u ewi t h i no n e y e a r . 1 5 .T h ec o v e n a n t sa n do t h e rt e r ms o ft h ea g r e e me n t b e t we e nt h ei s s u e ro f b o n d sa n dt h el e n d e ra r es e t f o r t h i nt h e

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b o n di n d e n t u r e . b o n dd e b e n t u r e . r e g i s t e r e db o n d . b o n dc o u p o n .

1 6 .T h er e s i d u a l i n t e r e s t i nac o r p o r a t i o nb e l o n g st ot h e a . ma n a g e me n t . b .c r e d i t o r s . c .c o mmo ns t o c k h o l d e r s . d .p r e f e r r e ds t o c k h o l d e r s . 1 7 .T h ep r e e mp t i v er i g h to fac o mmo ns t o c k h o l d e ri st h e r i g h t t o a .s h a r ep r o p o r t i o n a t e l yi nc o r p o r a t ea s s e t su p o n l i q u i d a t i o n . b .s h a r ep r o p o r t i o n a t e l yi na n yn e wi s s u e so f s t o c ko f t h es a mec l a s s . c .r e c e i v ec a s hd i v i d e n d sb e f o r et h e ya r e d i s t r i b u t e dt op r e f e r r e ds t o c k h o l d e r s . d .e x c l u d ep r e f e r r e ds t o c k h o l d e r sf r o mv o t i n g r i g h t s . 1 8 .T h ep r e e mp t i v er i g h t e n a b l e sas t o c k h o l d e r t o a .s h a r ep r o p o r t i o n a t e l yi na n yn e wi s s u e so f s t o c ko f t h es a mec l a s s . b .r e c e i v ec a s hd i v i d e n d sb e f o r eo t h e rc l a s s e so f s t o c kwi t h o u t t h ep r e e mp t i v er i g h t . c .s e l l c a p i t a l s t o c kb a c kt ot h ec o r p o r a t i o na tt h e o p t i o no f t h es t o c k h o l d e r . d .r e c e i v et h es a mea mo u n to fd i v i d e n d so na p e r c e n t a g e b a s i s a s t h e p r e f e r r e d s t o c k h o l d e r s . 1 9 .Wh i c ho ft h ef o l l o wi n gi n v e n t o r i e sc a r r i e db ya ma n u f a c t u r e ri ss i mi l a rt ot h eme r c h a n d i s ei n v e n t o r yo f a r e t a i l e r ? a . Ra wma t e r i a l s . b . Wo r k i n p r o c e s s . i n i s h e dg o o d s . c .F d . Su p p l i e s . 2 0 .Wh e r es h o u l dr a wma t e r i a l sb ec l a s s i fi e do nt h eb a l a n c e s h e e t ? a . Pr e p a i de x p e n s e s . n v e n t o r y . b .I c . Eq u i p me n t . d . No t o nt h eb a l a n c es h e e t . 2 1 .An e n t i t yp r o v i d e dt h ef o l l o wi n gi n f o r ma t i o nf o rt h e c u r r e n t y e a r : I n c o mef r o mc o n t i n u i n go p e r a t i o n s I n c o me f r o m d i s c o n t i n u e d o p e r a t i o n Un r e a l i z e dg a i no nfi n a n c i a l a s s e t F VPL

4 , 0 0 0 , 0 0 0 5 0 0 , 0 0 0 8 0 0 , 0 0 0

Un r e a l i z e d g a i n o n e q u i t y 1 , 0 0 0 , 0 0 0 i n v e s t me n t –FVOCI Un r e a l i z e dg a i no nd e b t i n v e s t me n t 1 , 2 0 0 , 0 0 0 FVOCI Un r e a l i z e dg a i no nf u t u r e sc o n t r a c t 4 0 0 , 0 0 0 d e s i g n a t e da sc a s hfl o wh e d g e T r a n s l a t i o n l o s s o n f o r e i g n 2 0 0 , 0 0 0 o p e r a t i o n 6 0 0 , 0 0 0 Ne tr e me a s u r e me n tg a i n o n d e fi n e db e n e fi tp l a nd u r i n gt h e y e a r L o s so nc r e d i tr i s ko fafi n a n c i a l 3 0 0 , 0 0 0 l i a b i l i t yd e s i g n a t e da sF VPL Re v a l u a t i o ns u r p l u sd u r i n gt h e 2 , 5 0 0 , 0 0 0 y e a r Wh a ta mo u n ts h o u l db er e p o r t e da sn e ti n c o mef o rt h e c u r r e n t y e a r ? a .4 , 0 0 0 , 0 0 0 , 5 0 0 , 0 0 0 b .4 c . 5 , 3 0 0 , 0 0 0 d .4 , 8 0 0 , 0 0 0 2 2 .Us i n gt h ep r e c e d i n gi n f o r ma t i o n , wh a t n e t a mo u n t s h o u l d b er e p o r t e da sOt h e rCo mp r e h e n s i v eI n c o mef o rt h e c u r r e n t y e a r ? a .4 , 0 0 0 , 0 0 0 b .3 , 5 0 0 , 0 0 0 , 2 0 0 , 0 0 0 c . 3 d .7 , 0 0 0 , 0 0 0 2 3 .Wh a ta mo u n ts h o u l db er e p o r t e da sc o mp r e h e n s i v e i n c o mef o rt h ec u r r e n t y e a r ? a .5 , 2 0 0 , 0 0 0 b .7 , 7 0 0 , 0 0 0 c . 8 , 5 0 0 , 0 0 0 d .7 , 2 0 0 , 0 0 0 2 4 .Emi l yCo .r e p o r t e dt h ef o l l o wi n gd a t eo nDe c e mb e r3 1 , 2 0 1 9 : Ca s hi nb a n k , n e t o f b a n ko v e r d r a f t o f P1 0 0 , 0 0 0 Pe t t yc a s h , i n c l u d i n gu n r e p l e n i s h e d p e t t yc a s he x p e n s e sP1 0 , 0 0 0 No t e sr e c e i v a b l e Ac c o u n t s r e c e i v a b l e , n e t c u s t o me r s ’a c c o u n twi t hc r e d i t b a l a n c e so f P2 0 0 , 0 0 0 Me r c h a n d i s ei n v e n t o r y ,e x c l u d i n g u n r e c o r d e d p u r c h a s e o f P3 0 0 , 0 0 0o na c c o u n ti nt r a n s i t o n De c e mb e r3 1 ,2 0 1 9a n d s h i p p e dF OPs h i p p i n gp o i n to n De c e mb e r 3 1 , 2 0 1 9 De f e r r e dc h a r g e r s Ac c o u n t sp a y a b l e ,n e to fs u p p l i e r s ’ a c c o u n t swi t hd e b i t b a l a n c e so f P4 0 0 , 0 0 0 No t e p a y a b l e , wi t h a n n u a l i n s t a l l me n t o f P5 0 0 , 0 0 0p a y a b l e e v e r yDe c e mb e r 3 1

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Wh a ta mo u n ts h o u l db er e p o r t e da st o t a l c u r r e n ta s s e t s o nDe c e mb e r3 1 , 2 0 1 9 ? a .7 , 4 9 0 , 0 0 0 b .7 , 5 0 0 , 0 0 0 c .7 , 6 4 0 , 0 0 0 d .7 , 0 9 0 , 0 0 0 2 5 .Us i n gt h ep r e c e d i n gi n f o r ma t i o n , wh a t a mo u n t s h o u l db e r e p o r t e da st o t a lc u r r e n tl i a b i l i t i e so nDe c e mb e r3 1 , 2 0 1 9 ? a .4 , 8 0 0 , 0 0 0 b .6 , 3 0 0 , 0 0 0 c .4 , 2 0 0 , 0 0 0 d .4 , 5 0 0 , 0 0 0 2 6 .Ane n t i t yr e p o r t e dr e v e n u eo fP5 0 , 0 0 0 , 0 0 0e x c l u d i n g i n t e r s e g me n ts a l e so f P1 0 , 0 0 0 , 0 0 0 ,e x p e n s e so f P4 7 , 0 0 0 , 0 0 0 ,a n dn e ti n c o meo fP3 , 0 0 0 , 0 0 0f o rt h e c u r r e n ty e a r . Ex p e n s e si n c l u d e dp a y r o l lc o s t so f P1 5 , 0 0 0 , 0 0 0 .Th ec o mb i n e da s s e t so fa l ls e g me n t s t o t a l e d4 5 , 0 0 0 , 0 0 0 .Wh a ti st h emi n i mu ma mo u n to f s a l e st oama j o rc u s t o me r ? a .5 , 0 0 0 , 0 0 0 b .4 , 0 0 0 , 0 0 0 c .4 , 5 0 0 , 0 0 0 d .6 , 0 0 0 , 0 0 0 2 7 .Es p r i tCo mp a n yk e e p sa l l i t sc a s hi nc h e c k i n ga c c o u n t , a ne x a mi n a t i o no f t h ec o mp a n y ’ sa c c o u n t i n gr e c o r d sa n d b a n ks t a t e me n t f o rt h emo n t he n d e dDe c e mb e r1 2 , 2 0 1 9 r e v e a l e dt h ef o l l o wi n gi n f o r ma t i o n :Ca s hb a l a n c ep e r b a n ks t a t e me n tP8 4 6 , 9 0 0 ;Ca s hb a l a n c ep e rl e d g e r P8 5 2 , 4 0 0 , Ad e p o s i t o f 9 5 , 0 0 0p l a c e di nt h eb a n k ’ sn i g h t d e p o s i t o r y o nDe c e mb e r2 9 ,2 0 1 9d o e sn o ta p p e a ro nt h eb a n k s t a t e me n t . Th eb a n ks t a t e me n t s h o wst h a t o nDe c e mb e r 2 6 ,2 0 1 9 ,t h eb a n kc o l l e c t e d an o t ef o rEs p r i ta n d c r e d i t e dt h ep r o c e e d so fP9 3 , 5 0 0t ot h ec o mp a n y ’ s a c c o u n t .T h ep r o c e e d si n c l u d e dP3 , 5 0 0i n t e r e s t ,a l lo f wh i c hEs p r i te a r n e dd u r i n gt h ec u r r e n ty e a r .Es p r i th a s n o t y e t r e c o r d e dt h ec o l l e c t i o n . Ou t s t a n d i n gc h e c k so nDe c e mb e r3 1 ,2 0 1 9we r eNo . 0 3 2 7 5 2P1 5 , 0 0 0 ;N.0 3 2 7 5 8P4 , 8 0 0 ;No .0 3 2 7 6 7 P7 , 2 0 0 . Es p r i td i s c o v e r e dt h a tc h e c kn o .0 3 2 7 5 9 wr i t t e ni n De c e mb e r2 0 1 9f o rP1 8 , 3 0 0i np a y me n to fa na c c o u n t h a db e e nr e c o r d e di nt h ec o mp a n y ’ sr e c o r d sa s P1 3 , 8 0 0 .I n c l u d e dwi t ht h a tDe c e mb e r3 1 ,2 0 1 9b a n k s t a t e me n t wa sa nNSFc h e c kf o rP2 5 , 0 0 0t h a t Es p r i t h a d r e c e i v e df r o m Pi t tCo mp a n yo na c c o u n to nDe c e mb e r 2 0 , 2 0 1 9 . Es p r i t h a sn o t y e t r e c o r d e dt h er e t u r n e dc h e c k . T h eb a n ks t a t e me n ts h o wsaP1 , 5 0 0s e r v i c ec h a r g ef o r De c e mb e r .

T h ej o u r n a le n t r yt oa d j u s tt h ec a s hb a l a n c ea so f De c e mb e r 3 1 , 2 0 1 9i s a . De b i t t oc a s hf P9 3 , 5 0 0 b . Cr e d i t t oc a s ho f P3 1 , 0 0 0 t d e b i t t oc a s ho f P6 2 , 5 0 0 c . Ne d . Ne t c r e d i t t oc a s ho f P6 2 , 5 0 0 2 8 .Us i n gt h ep r e c e d i n gi n f o r ma t i o n ,t h ec o r r e c tc a s h b a l a n c ea t De c e mb e r 3 1 , 2 0 1 9i s a .9 4 5 , 9 0 0 b .9 1 4 , 9 0 0 c . 8 2 1 , 4 0 0 d .7 8 9 , 9 0 0 2 9 .On J a n u a r y1 ,2 0 1 9 , Ro c k e t s Co r p o r a t i o ns o l d e q u i p me n t c o s t i n g P3 8 0 , 0 0 0 wi t h a c c u mu l a t e d d e p r e c i a t i o no fP1 6 0 , 0 0 0o nt h ed a t eo fs a l e .Ro c k e t s r e c e i v e da sc o n s i d e r a t i o nf o rt h es a l eaP4 0 0 , 0 0 0n o n i n t e r e s tb e a r i n gn o t e ,d u eJ a n u a r y1 ,2 0 2 2 .T h e r ewa s n oe s t a b l i s h e de x c h a n g ep r i c ef o rt h ee q u i p me n t a n dt h e n o t eh a dn or e a d yma r k e t .T h ep r e v a i l i n gr a t eo fi n t e r e s t f o ran o t eo ft h i st y p ea tJ a n u a r y1 ,2 0 1 9wa s1 0 %.T h e p r e s e n t v a l u eo f 1a t 1 0 %f o r t h r e ep e r i o d si s0 . 7 5 . I nRo c k e t s2 0 1 9p r o fi to rl o s s ,h o w mu c hs h o u l db e r e p o r t e da si n t e r e s t i n c o me ? a .3 0 , 0 0 0 b .4 0 , 0 0 0 c . 3 3 , 0 0 0 d .1 3 , 5 0 0 3 0 . Us i n gt h ep r e c e d i n gi n f o r ma t i o n ,wh a ti st h en o t e ’ s c a r r y i n ga mo u n t a t De c e mb e r3 1 , 2 0 1 9 ? a .3 4 0 , 0 0 0 3 0 , 0 0 0 b .3 c . 3 0 0 , 0 0 0 d .1 3 5 , 0 0 0 3 1 .As s u mi n gt h a tt h ee q u i p me n twa ss o l da n dn o t e d e s c r i b e dwa sr e c e i v e do nJ u l y1 ,2 0 1 9 ,a l lo t h e rd a t a b e i n gt h es a me ,wh a ti st h ei n t e r e s ti n c o mef o rt h ey e a r e n d e dDe c e mb e r 3 1 , 2 0 1 9 ? a .1 5 , 0 0 0 b .1 6 , 5 0 0 c . 2 0 , 0 0 0 d .3 0 , 0 0 0 3 2 .OnJ a n u a r y1 , 2 0 1 9 , a ne n t i t ya c q u i r e da1 0 %i n t e r e s t i n a ni n v e s t e ef o r3 , 0 0 0 , 0 0 0 .T h ei n v e s t me n t a c c o u n t e df o r u n d e rt h ec o s tme t h o d .Du r i n g2 0 1 9 ,t h ei n v e s t e e r e p o r t e dn e ti n c o meo fP4 , 0 0 0 , 0 0 0a n dp a i dd i v i d e n do f P1 , 0 0 0 , 0 0 0 . OnJ a n u a r y1 ,2 0 2 0 ,t h ee n t i t ya c q u i r e df u r t h e r1 5 % i n t e r e s t i nt h ei n v e s t e ef o rP8 , 5 0 0 , 0 0 0 . Ons u c hd a t e , t h e c a r r y i n ga mo u n to ft h en e ta s s e t so ft h ei n v e s t e ewa s P3 6 , 0 0 0 , 0 0 0a n dt h ef a i rv a l u eo ft h e1 0 % e x i s t i n g i n t e r e s twa sP3 , 5 0 0 , 0 0 0 .T h ef a i rv a l u eo f t h en e t a s s e t s o f t h ei n v e s t e ei se q u a l t oc a r r y i n ga mo u n t , e x c e p t f o ra n

e q u i p me n t wh o s ef a i rv a l u ewa sP4 , 0 0 0 , 0 0 0g r e a t e rt h a n c a r r y i n ga mo u n t .T h ee q u i p me n th a dar e ma i n i n gl i f eo f 5y e a r s . T h ei n v e s t e er e p o r t e dn e t i n c o meo f P8 , 0 0 0 , 0 0 0f o r 2 0 2 0 a n dp a i dd i v i d e n do f P6 , 0 0 0 , 0 0 0o nDe c e mb e r 3 1 , 2 0 2 0 . Wh a ta mo u n to fi n v e s t me n ti n c o me s h o u l db e r e c o g n i z e di n2 0 1 9 ? a .4 0 0 , 0 0 0 0 0 , 0 0 0 b .1 c .5 0 0 , 0 0 0 d .3 0 0 , 0 0 0 3 3 .Wh a t i st h ei mp l i e dg o o d wi l l a r i s i n gf o rt h ea c q u i s i t i o no f J a n u a r y1 , 2 0 2 0 ? a .3 , 0 0 0 , 0 0 0 b .2 , 0 0 0 , 0 0 0 c .2 , 5 0 0 , 0 0 0 d .7 5 0 , 0 0 0

3 4 .Wh a tt o t a la mo u n to fi n c o mes h o u l db er e c o g n i z e db y t h ei n v e s t o r o n2 0 2 0 ? a .2 , 0 0 0 , 0 0 0 b .2 , 5 0 0 , 0 0 0 , 3 0 0 , 0 0 0 c .2 d .1 , 8 0 0 , 0 0 0 3 5 .Wh a ti st h ec a r r y i n ga mo u n to ft h ei n v e s t me n ti n a s s o c i a t eo nDe c e mb e r 3 1 , 2 0 2 0 ? a .1 2 , 3 0 0 , 0 0 0 b .1 2 , 5 0 0 , 0 0 0 c .1 3 , 8 0 0 , 0 0 0 d .1 2 , 9 0 0 , 0 0 0 3 6 .OnJ a n u a r y1 , 2 0 1 9 , a ne n t i t yp u r c h a s e db o n d swi t hf a c e a mo u n to fP5 , 0 0 0 , 0 0 0 .Th ee n t i t yp a i dP4 , 5 0 0 , 0 0 0p l u s t r a n s a c t i o nc o s to fP1 6 8 , 6 0 0 .T h eb o n d sma t u r eo n De c e mb e r3 1 ,2 0 2 2a n dp a y6 %i n t e r e s ta n n u a l l yo n De c e mb e r 3 1o f e a c hy e a r wi t h8 %e ff e c t i v ey i e l d . T h eb o n d swe r eq u o t e da t1 0 5o nDe c e mb e r3 1 ,2 0 1 9 a n d1 1 0o nDe c e mb e r3 1 , 2 0 2 0 . T h eb u s i n e s smo d e li nma n a g i n gfi n a n c i a la s s e ti st o c o l l e c t c o n t r a c t u a l c a s hfl o wst h a t a r es o l e l yp a y me n t so f p r i n c i p a la n di n t e r e s ta n dt os e l lt h eb o n d si nt h eo p e n ma r k e t . T h ee n t i t yh a dn o te l e c t e dt h ef a i rv a l u eo p t i o n .On De c e mb e r3 1 ,2 0 2 0 ,t h ee n t i t yc h a n g e di t sb u s i n e s s mo d e lt oc o l l e c to n l yc o n t r a c t u a lc a s h fl o ws .I n De c e mb e r3 1 ,2 0 2 1 ,t h eb o n d swe r eq u o t e da t1 1 4a n d t h ema r k e t i n t e r e s t r a t ei s1 0 %

Wh a ta mo u n to fu n r e a l i z e dg a i ns h o u l db er e p o r t e da s c o mp o n e n to fOCIi nt h es t a t e me n to fc o mp r e h e n s i v e i n c o mef o r2 0 1 9 ? a .5 0 0 , 0 0 0 b .6 7 8 , 5 4 5 0 7 , 9 1 2 c . 5 d .0 3 7 .Wh a ta mo u n to fc u mu l a t i v eu n r e a l i z e dg a i ns h o u l db e r e p o r t e da sc o mp o n e n t o f Z OCI i ns t a t e me n t o fc h a n g e s i ne q u i t yf o r2 0 2 0 ? a .5 0 0 , 0 0 0 b .6 7 8 , 5 4 5 c . 5 0 7 , 9 1 2 d .0

3 8 .Wh a ta mo u n to fu n r e a l i z e dg a i ns h o u l db er e p o r t e di f I CU u nt h es t a t e me n to fc o mp r e h e n s i v ei n c o mef o r 2 0 2 0 ? a .5 0 0 , 0 0 0 b .2 5 0 , 0 0 0 c . 1 7 0 , 6 3 3 d .1 8 5 , 2 0 0 3 9 .Wh a t i st h ei n t e r e s t i n c o mef o r 2 0 2 1 ? a .3 0 0 , 0 0 0 b .5 0 0 , 0 0 0 c . 3 8 5 , 7 1 6 d .3 6 9 , 9 8 4 4 0 .Sa mCo mp a n ys t a r t e db u s i n e s si n2 0 1 8 .I ts e l l sp r i n t e r s wi t hat h r e e y e a rwa r r a n t y .Sa me s t i ma t e si t swa r r a n t y c o s ta sap e r c e n t a g eo fp e s os a l e s .Ba s e do np a s t e x p e r i e n c e , i t i se s t i ma t e dt h a t 2 %wi l l b er e p a i r e dd u r i n g t h efi r s ty e a ro fwa r r a n t y ,4 % wi l l b er e p a i r e dd u r i n gt h e s e c o n dy e a ro fwa r r a n t ya n d6 % wi l lb er e p a i r e di nt h e t h i r dy e a r . I n2 0 1 8a n d2 0 1 9 ,c o mp a n ywa sa b l et os e l l 7 , 5 0 0u n i t s a n d8 , 4 0 0u n i t s ,r e s p e c t i v e l ya t as e l l i n gp r i c eo f P5 , 0 0 0 p e ru n i t .T h ec o mp a n ya l s oi n c u r r e da c t u a lr e p a i rc o s t s o fP5 3 0 , 0 0 0a n d P1 , 1 7 6 , 0 0 0i n2 0 1 8a n d2 0 1 9 , r e s p e c t i v e l y . Wh a t a mo u n t s h o u l dSa mr e p o r t a swa r r a n t ye x p e n s ei n 2 0 1 8 ? a .7 , 8 3 4 , 0 0 0 b .5 , 0 4 0 , 0 0 0 , 5 0 0 , 0 0 0 c . 4 d .4 , 9 7 0 , 0 0 0 4 1 .Wh a ti st h ea mo u n to fl i a b i l i t yf o rwa r r a n t yr e p o r t e di n Sa m’ s De c e mb e r3 1 ,2 0 1 9s t a t e me n to ffi n a n c i a l p o s i t i o n ? a .7 , 8 3 4 , 0 0 0 b .5 , 0 4 0 , 0 0 0 c . 4 , 5 0 0 , 0 0 0

d .3 , 0 2 4 , 0 0 0 4 2 .As s u mi n gt h a ts a l e sa n dr e p a i ro c c u re v e n l yt h r o u g h o u t t h ep e r i o dh o wmu c hwo u l db et h ep r e d i c t e dwa r r a n t y e x p e n s ec o v e r i n g2 0 1 8a n d2 0 1 9s a l e ss t i l lu n d e r wa r r a n t y ? a .8 , 7 9 0 , 0...