Equity Investment classified at Fair Through Other Comprehensive Income (choose which of the following is true) Securities not held for trading for which the enterprise elects to recognize change in fair value through other comprehensive income Initially measured at Fair value minus transaction costs Measured after initial recognition at Cost Which dividends are taken to Other Comprehensive Income

Equity Investment classified at Fair Through Other Comprehensive Income (choose which of the following is true) Securities not held for trading for which the enterprise elects to recognize change in fair value through other comprehensive income Initially measured at Fair value minus transaction costs Measured after initial recognition at Cost Which dividends are taken to Other Comprehensive Income

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter13: Marketable Securities And Derivatives

Section: Chapter Questions

Problem 12E

See similar textbooks

Similar questions

When the market value of a companys available-for-sale securities is lower than its cost, the difference should be: a. shown as a liability. b. shown as a valuation allowance added to the historical cost of the investments. c. shown as a valuation allowance subtracted from the historical cost of the investments. d. No entry is made, the securities are shown at historical cost.
Under fair-value accounting for an equity investment, which of the following affects the income the investor recognizes from its ownership of the investee? The investee’s reported income adjusted for excess cost over book value amortizations. Changes in the fair value of the investor’s ownership shares of the investee. Intra-entity profits from upstream sales. Other comprehensive income reported by the investee.
an initial recognition an entity may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument that is a) on initial recognition is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit taking b) a derivative c) acquired principally for the purpose of selling it in the near term d) none of these
Choose the correct. Under fair-value accounting for an equity investment, which of the following affects the income the investor recognizes from its ownership of the investee?a. The investee’s reported income adjusted for excess cost over book value amortizations.b. Changes in the fair value of the investor’s ownership shares of the investee.c. Intra-entity profits from upstream sales.d. Other comprehensive income reported by the investee.
In subsequent periods after purchase, investments in available-for-sale securities will be reported at fair value. cost. face value. par value. 2. For investments in available-for-sale securities, a debit balance in the Unrealized Holding Gain/Loss account reflects a cumulative unrealized gain. is reported as a negative element in the accumulated other comprehensive income section of shareholders' equity. is reported as a positive element in the accumulated other comprehensive income section of shareholders' equity. is reported as a positive element in the assets section of the balance sheet.
The following terms were introduced in this chapter: Strategic investments Non-strategic investments Investments at fair value through profit or loss (FVTPL) Investments at amortized cost (AC) Match each term with the following definitions: _________ Debt securities that are held to earn interest income _________ Investments purchased to influence or control another company _________ Debt or equity investments that require holding gains or losses to be included in the determination of the company’s profit or loss. _________ Investments purchased mainly to generate investment income
At initial recognition, an entity may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument that is A. Acquired principally for the purpose of selling it in the near term. B. A derivative. C.None of these. D. On initial recognition is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit taking.
Why are unrealized gains and losses from available-for-sale securities not reported as a component of net income? Select one: a. Because goodwill exists that must be separately accounted for b. Because the investor has the ability to exercise significant influence over the investee c. Because consolidated financial statements must be prepared d. Because large swings in market value over which management has no control may distort current period performance as measured by net income
At initial recognition, an entity may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument that is Group of answer choices Acquired principally for the purpose of selling it in the near term. On initial recognition is part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking. A derivative. None of these.
1 Unrealized holding gain/loss which are taken to profit or loss are from securities that are classified as a. held to maturity b. investment in associate c. equity investment at fair value through profit or loss d. equity investment at fair value through other comprehensive income
Which of the following statements is TRUE regarding the equity method? A. The equity method is used for reporting gains or losses for non-strategic investments. B. The investor's share of the associate's dividends declared is reported as revenue. C. The investor's investment in the associate changes in direct relation to the changes taking place in the associate's equity accounts. D. The equity method reports unrealized gains and losses on revaluations to fair value in net income.
Which of the following statements is not true of the fair-value method of accounting for marketable securities? Select one: A. The investment account is recorded at current fair value on the balance sheet. B. Interim changes in the investments’ fair value may or may not affect income depending on the securities’ classification. C. This method is used when the reporting company generally owns less than 20% of the investee company. D. Dividends are treated as a return of the capital invested. E. None of the above