Question 1

Held-to-maturity investments applies only to debt securities because ________.

Accepted Answer

A) these securities earn periodic interest 
B) equity securities do not mature on a specific date 
C) these are long-term investments 
D) equity securities are held for a short period of time 
A) these securities earn periodic interest 
B) equity securities do not mature on a specific date 
C) these are long-term investments 
D) equity securities are held for a short period of time

Question 2

Significant interest investments must be accounted for using the ________.

Accepted Answer

A) equity method 
B) consolidation method 
C) discounted cash flow method 
D) acquisition method 
A) equity method 
B) consolidation method 
C) discounted cash flow method 
D) acquisition method

Question 3

Which of the following is true of trading investments?

Accepted Answer

A) They are held for more than two years. 
B) They are generally recorded as long-term investments. 
C) They must be adjusted and reported at fair value at the end of each accounting period. 
D) They are always reported on the balance sheet at their historical cost. 
A) They are held for more than two years. 
B) They are generally recorded as long-term investments. 
C) They must be adjusted and reported at fair value at the end of each accounting period. 
D) They are always reported on the balance sheet at their historical cost.

Question 4

Under the equity method,the investor ________.

Accepted Answer

A) must debit the Long-term Investments account when a dividend is received 
B) must record its share of the investee's net income 
C) must use the LIFO method for tax purposes 
D) debits the Revenue from Investments when the investee reports income 
A) must debit the Long-term Investments account when a dividend is received 
B) must record its share of the investee's net income 
C) must use the LIFO method for tax purposes 
D) debits the Revenue from Investments when the investee reports income

Question 5

Debra Technologies invests $50,000 to acquire $50,000 face value,10%,five-year corporate bonds on December 31,2010.The bonds will mature on December 31,2015.The bonds pay interest semiannually on December 31 and June 30 every year until maturity.Assume Debra Technologies uses a calendar year.Based on the information provided,which of the following will be included in the journal entry for the transaction on December 31,2014?

Accepted Answer

A) a credit to Interest Revenue for $5,000 
B) a debit to Interest Revenue for $5,000 
C) a credit to Interest Revenue for $2,500 
D) a debit to Interest Revenue for $2,500 
A) a credit to Interest Revenue for $5,000 
B) a debit to Interest Revenue for $5,000 
C) a credit to Interest Revenue for $2,500 
D) a debit to Interest Revenue for $2,500

Question 6

Angelo Services,Inc.reported the following balance sheet information for the year 2017.Based on the following information,calculate the rate of return on total assets for Angelo Services,Inc.

Accepted Answer

A) 10.91% 
B) 7.92% 
C) 16.21% 
D) 7.22% 
A) 10.91% 
B) 7.92% 
C) 16.21% 
D) 7.22%

Held-to-maturity investments applies only to debt securities because ________.

Significant interest investments must be accounted for using the ________.

Which of the following is true of trading investments?

Under the equity method,the investor ________.

Angelo Services,Inc.reported the following balance sheet information for the year 2017.Based on the following information,calculate the rate of return on total assets for Angelo Services,Inc.

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters

Exam 15: Investments

Held-to-maturity investments applies only to debt securities because ________.

Significant interest investments must be accounted for using the ________.

Which of the following is true of trading investments?

Under the equity method,the investor ________.

Angelo Services,Inc.reported the following balance sheet information for the year 2017.Based on the following information,calculate the rate of return on total assets for Angelo Services,Inc.

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters