When a business has Available-for-Sale Securities, the account Unrealized Loss onAvailable-for-Sale Investments should be included in the:Statement of Retained EarningsIncome statementBalance sheet as an addition to Long-Term Investments in StockBalance sheet as a deduction in Stockholders' Equity

Available-for-sale securities Available-for-securities are referred to as equity or debt security…

When a business has Available-for-Sale Securities, the account Unrealized Loss on Available-for-Sale Investments should be included in the: O Statement of Retained Earnings Income statement Balance sheet as an addition to Long-Term Investments in Stock Balance sheet as a deduction in Stockholders' Equity

When a business has Available-for-Sale Securities, the account Unrealized Loss on Available-for-Sale Investments should be included in the: O Statement of Retained Earnings Income statement Balance sheet as an addition to Long-Term Investments in Stock Balance sheet as a deduction in Stockholders' Equity

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 12MCQ: When the market value of a companys available-for-sale securities is lower than its cost, the...

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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.
Stockholders equity consists of which of the following? A. bonds payable B. retained earnings and accounts receivable C. retained earnings and paid-in capital D. discounts and premiums on bond payable
Treasury stock is listed as a(n) __________ on the balance sheet. (a) current liability (b) current asset (c) deduction from stockholders equity (d) addition to stockholders equity
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.
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.
When an investor uses the equity method to account for investments in common stock, the investor’s share of cash dividends from the investee should be recorded as A deduction from the investor’s share of the investee’s profits. Dividend income. A deduction from the stockholders’ equity account, Dividends to Stockholders. A deduction from the investment account. (AICPA adapted)
Realized gains and losses are recorded on the incomestatement for which of the following transactions in trading securities and available-for-sale securities?a. When adjusting trading securities to fair value.b. When adjusting available-for-sale securities to fair value.c. Only when recording the sale of trading securities.d. When recording the sale of either trading securities oravailable-for-sale securities
If the combined market value of equity investment at fair value through profit or loss at the end of the year is more than the market value of the same portfolio of trading securities at the beginning of the year, the difference should be accounted for by: a debit to equity investment O reporting an unrealized loss in security investment in the stockholders' equity section of the balance sheet a footnote to the financial statements reporting an unrealized loss in security investments in the income statement O reporting an unrealized gain in security investments in the income statement
For fi nancial assets classifi ed as trading securities, how are unrealized gains and losses refl ected in shareholders’ equity? B . Th ey fl ow through income into retained earnings.
When the market value of a company’s portfolio of available-for-sale securities is lower than its cost，the difference should be: a. accounted for as a valuation allowance deducted from the asset to which it relates b. accounted for as an addition in the shareholders’ equity section of the balance sheet c. accounted for as a liability d. disclosed and described in a note to the financial statements but not accounted for.
When holding held-to-maturity securities, a company should disclose at each balance sheet date the aggregate fair value of the securities. the gross unrecognized holding gains and losses. the amortized cost of the securities. all of these choices. 2. When holding available-for-sale securities, a company should disclose for each income statement period gross realized gains and losses as a separate component of other comprehensive income. unrealized gains and losses included in net income. proceeds from sales and the gross realized gains and losses on those sales. none of these choices.
For fi nancial assets classifi ed as trading securities, how are unrealized gains and losses refl ected in shareholders’ equity? C . Th ey are a component of accumulated other comprehensive income.