Question 1

The term "equity security" refers to the guarantee your broker gives you concerning an investment that was just made for you.

Accepted Answer

A) True 
 B)False

Question 2

The main feature of a non-strategic investment is that the investor's intent is to generate profit primarily through short-term changes in fair value.

Accepted Answer

A) True 
 B)False

Question 3

Tool Co.received dividends of $35 per share on 300 Sharp Systems Inc shares.The journal entry to record the transaction is a debit to Cash of $10,500 and a credit to Dividend Revenue of $10,500.

Accepted Answer

A) True 
 B)False

Question 4

After initial recognition,using ASPE,an entity should measure debt securities at:

Accepted Answer

A)  Fair value through profit and loss. 
B)  Cost. 
C)  Future cash flows. 
D)  Amortized cost. 
E)  Present valuE. 
A)  Fair value through profit and loss. 
B)  Cost. 
C)  Future cash flows. 
D)  Amortized cost. 
E)  Present valuE.

Question 5

On January 2,London Corp purchased 10,000 Greenwich Corp common shares at $21 per share plus a $5,200 commission.On August 6,Greenwich Corp declared and paid dividends of $1.10 per share,and on December 31,it reported a net income of $150,000.Assuming Greenwich Corp has 24,000 common shares outstanding.Prepare the necessary entries on the books of London Corp to account for these transactions.

Accepted Answer

The answer of On January 2,London Corp purchased 10,000 Greenwich...

Question 6

Micron owns 40% of the outstanding Martok Corp common shares.Martok paid $97,000 in total cash dividends to its shareholders.Micron's entry to record the transaction should include a:

Accepted Answer

A)  Debit to Dividends for $97,000. 
B)  Debit to Dividends for $38,800. 
C)  Debit to investment in Martok Common Shares for $97,000. 
D)  Credit to Investment in Martok Common Shares for $38,800. 
E)  Debit to Cash for $97,000. 
A)  Debit to Dividends for $97,000. 
B)  Debit to Dividends for $38,800. 
C)  Debit to investment in Martok Common Shares for $97,000. 
D)  Credit to Investment in Martok Common Shares for $38,800. 
E)  Debit to Cash for $97,000.

Question 7

Non-strategic investments usually:

Accepted Answer

A)  Are purchased for the short-term. 
B)  Include investments in associates. 
C)  Include shares not intended to be converted into cash. 
D)  Include bonds intended to be held-to-maturity. 
E)  Include shares not intended to be converted into cash and include bonds intended to be held-to-maturity. 
A)  Are purchased for the short-term. 
B)  Include investments in associates. 
C)  Include shares not intended to be converted into cash. 
D)  Include bonds intended to be held-to-maturity. 
E)  Include shares not intended to be converted into cash and include bonds intended to be held-to-maturity.

Question 8

Non-strategic investments are of two types: debt and share investments.

Accepted Answer

A) True 
 B)False

Question 9

You have just purchased some shares in a Canadian public company.Your friends call you an "investee." You are surprised that they got it wrong: you are an investor.

Accepted Answer

A) True 
 B)False

Question 10

The receipt of cash dividends from a significant influence investment is recorded as a reduction to retained earnings by the investor.

Accepted Answer

A) True 
 B)False

Question 11

Classical City purchased 1,500 shares of Piano Corp.common shares for $42,250 on August 15 of this year.This purchase represented .09% of Piano Corp's outstanding common shares.Prepare the journal entry to record the purchase.

Accepted Answer

The answer of Classical City purchased 1,500 shares of Piano...

Question 12

Joint arrangements should be accounted for using:

Accepted Answer

A)  Proportionate consolidation. 
B)  Fair value. 
C)  Historical cost. 
D)  Amortized cost. 
E)  Consolidation. 
A)  Proportionate consolidation. 
B)  Fair value. 
C)  Historical cost. 
D)  Amortized cost. 
E)  Consolidation.

Question 13

Non-strategic investments are usually:

Accepted Answer

A)  Current assets. 
B)  Expected to be converted into cash within one year. 
C)  Expected to provide profits through short-term changes in price. 
D)  Subject to frequent buying and selling. 
E)  All of these answers are correct. 
A)  Current assets. 
B)  Expected to be converted into cash within one year. 
C)  Expected to provide profits through short-term changes in price. 
D)  Subject to frequent buying and selling. 
E)  All of these answers are correct.

Question 14

Under IFRS,investments in associates are accounted for using the fair value through profit or loss method.

Accepted Answer

A) True 
 B)False

The term "equity security" refers to the guarantee your broker gives you concerning an investment that was just made for you.

The main feature of a non-strategic investment is that the investor's intent is to generate profit primarily through short-term changes in fair value.

Tool Co.received dividends of $35 per share on 300 Sharp Systems Inc shares.The journal entry to record the transaction is a debit to Cash of $10,500 and a credit to Dividend Revenue of $10,500.

After initial recognition,using ASPE,an entity should measure debt securities at:

Micron owns 40% of the outstanding Martok Corp common shares.Martok paid $97,000 in total cash dividends to its shareholders.Micron's entry to record the transaction should include a:

Non-strategic investments usually:

Non-strategic investments are of two types: debt and share investments.

You have just purchased some shares in a Canadian public company.Your friends call you an "investee." You are surprised that they got it wrong: you are an investor.

The receipt of cash dividends from a significant influence investment is recorded as a reduction to retained earnings by the investor.

Classical City purchased 1,500 shares of Piano Corp.common shares for $42,250 on August 15 of this year.This purchase represented .09% of Piano Corp's outstanding common shares.Prepare the journal entry to record the purchase.

Joint arrangements should be accounted for using:

Non-strategic investments are usually:

Under IFRS,investments in associates are accounted for using the fair value through profit or loss method.

Property,plant and Equipment,and Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income,earnings Per Share,and Retained Earnings

Bonds and Long-Term Notes Payable

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Filters

Exam 16: Accounting for Debt and Share Investments

The term "equity security" refers to the guarantee your broker gives you concerning an investment that was just made for you.

The main feature of a non-strategic investment is that the investor's intent is to generate profit primarily through short-term changes in fair value.

Tool Co.received dividends of $35 per share on 300 Sharp Systems Inc shares.The journal entry to record the transaction is a debit to Cash of $10,500 and a credit to Dividend Revenue of $10,500.

After initial recognition,using ASPE,an entity should measure debt securities at:

Micron owns 40% of the outstanding Martok Corp common shares.Martok paid $97,000 in total cash dividends to its shareholders.Micron's entry to record the transaction should include a:

Non-strategic investments usually:

Non-strategic investments are of two types: debt and share investments.

You have just purchased some shares in a Canadian public company.Your friends call you an "investee." You are surprised that they got it wrong: you are an investor.

The receipt of cash dividends from a significant influence investment is recorded as a reduction to retained earnings by the investor.

Classical City purchased 1,500 shares of Piano Corp.common shares for $42,250 on August 15 of this year.This purchase represented .09% of Piano Corp's outstanding common shares.Prepare the journal entry to record the purchase.

Joint arrangements should be accounted for using:

Non-strategic investments are usually:

Under IFRS,investments in associates are accounted for using the fair value through profit or loss method.

Property,plant and Equipment,and Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income,earnings Per Share,and Retained Earnings

Bonds and Long-Term Notes Payable

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Filters