All equity securities and investments in debt securities that are intended to be sold in the near term are classified as held-to-maturity securities. trading securities. available-for-sale securities. none of these choices.
All equity securities and investments in debt securities that are intended to be sold in the near term are classified as held-to-maturity securities. trading securities. available-for-sale securities. none of these choices.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
All equity securities and investments in debt securities that are intended to be sold in the near term are classified as
- held-to-maturity securities.
- trading securities.
- available-for-sale securities.
- none of these choices.
2. Any change in the fair value of trading securities is
- reported on the income statement as part of net income.
- reported as part of other comprehensive income in the shareholders' equity section of the balance sheet.
- ignored; only the amortized cost is reflected in the financial statements.
- reported as a
cash outflow in the investing activities section of the statement ofcash flows.
3. A minority active investment with significant influence occurs when the investor owns
- between 10% and 20% of the voting common stock of the investee.
- over 50% of the voting common stock of the investee.
- between 20% and 50% of the voting common stock of the investee.
- over 50% of the
preferred stock of the investee.
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