Find the carrying amount of the emission liability at june

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Problem 1: On 1 July 20X0 Alpha Ltd received emission trading allowances (ETAs) for 1,000 tonnes of carbon dioxide from the government at no cost. The fair value of ETAs was $32 per tonne at 1 July 20X0, but had increased to $40 per tonne at 30 June 20X1 and remained at $40 per tonne until 31 August. Alpha Ltd emitted 500 tonnes of carbon dioxide during the year. Settlement is due 31 August. If Alpha Ltd uses the IFRIC 3 model without revaluation to account for the ETAs, the carrying amount of the Emission liability at 30 June 20X1 is: On settling the emission liability, Alpha would recognise

Option 1: A loss on settlement in profit or loss
Option 2: A gain on settlement in profit or loss
Option 3: A loss on settlement in other comprehensive income
Option 4: A gain on settlement in other comprehensive income

Reference no: EM132767143

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