Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 15, Problem 5DQ
To determine
Describe the accounting treatment of equity investment, if the investor invests more than 50% in outstanding company.
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Students have asked these similar questions
Explain how an investor in an equity REIT may receive a current dividend, part of which may be tax-deferred.
If an investor sells an ordinary share at a price above that which he or she originally paid, the investor is said to have earnedSelect one:
a.a capital expenditure.
b.a capital gain.
c.an originating point.
d.a dividend.
explain well all point of question.
1. Anton wants to have a portion of ownership of a certain company. Which of the following should he invest?
A. Annuity
B. Bonds
C. Shares
D. Stocks
2. What writtwn contract is exhibited by a debtor that is legally binding which stipulates the amount borrowed at a specified tine in the future?
A. Stocks
B. Annuity
C. Amortization
D. Bonds
3. Which of the following covers when the frequency of the regular payment is different from the frequency of interest conversion?
A. Bonds
B. Ammortilation
C. General annuity
D. Simple annuity
4. What term is refers to the type of arrangement where composition is important but not order?
A. Courting
B. Permutation
C. Multiplication rulw
D. Combination
5. If p q is a tautology, then what can you inter about p and q?
A. P and Q are either true or false but not both
B. P and Q are always false
C. P and Q are always true
D. P and Q are either both true or false both false
Chapter 15 Solutions
Financial Accounting
Ch. 15 - Why might a business invest cash in temporary...Ch. 15 - What causes a gain or loss on the sale of a bond...Ch. 15 - When is the equity method the appropriate...Ch. 15 - Prob. 4DQCh. 15 - Prob. 5DQCh. 15 - Prob. 6DQCh. 15 - Prob. 7DQCh. 15 - Prob. 8DQCh. 15 - Prob. 9DQCh. 15 - Prob. 10DQ
Ch. 15 - Prob. 1PEACh. 15 - Prob. 1PEBCh. 15 - Prob. 2PEACh. 15 - Prob. 2PEBCh. 15 - Prob. 3PEACh. 15 - Prob. 3PEBCh. 15 - On January 1, Valuation Allowance for Trading...Ch. 15 - On January 1, Valuation Allowance for Trading...Ch. 15 - On January 1, Valuation Allowance for...Ch. 15 - On January 1, Valuation Allowance for...Ch. 15 - On June 30, Setzer Corporation had a market price...Ch. 15 - Prob. 6PEBCh. 15 - Prob. 1ECh. 15 - Prob. 2ECh. 15 - Bocelli Co. purchased 120,000 of 6%, 20-year Sanz...Ch. 15 - Prob. 4ECh. 15 - Prob. 5ECh. 15 - On February 22, Stewart Corporation acquired...Ch. 15 - The following equity investment transactions were...Ch. 15 - Yerbury Corp. manufactures construction equipment....Ch. 15 - Seamus Industries Inc. buys and sells investments...Ch. 15 - Prob. 10ECh. 15 - Prob. 11ECh. 15 - On January 6, Year 1, Bulldog Co. purchased 34% of...Ch. 15 - Hawkeye Companys balance sheet reported, under the...Ch. 15 - JED Capital Inc. makes investments in trading...Ch. 15 - The investments of Charger Inc. include a single...Ch. 15 - Gruden Bancorp Inc. purchased a portfolio of...Ch. 15 - Last Unguaranteed Financial Inc. purchased the...Ch. 15 - The income statement for Delta-tec Inc. for the...Ch. 15 - Highland Industries Inc. makes investments in...Ch. 15 - The investments of Steelers Inc. include a single...Ch. 15 - Prob. 21ECh. 15 - Storm, Inc. purchased the following...Ch. 15 - During Year 1, its first year of operations,...Ch. 15 - During Year 2, Copernicus Corporation held a...Ch. 15 - Prob. 25ECh. 15 - The market price for Microsoft Corporation closed...Ch. 15 - Prob. 27ECh. 15 - Prob. 28ECh. 15 - Prob. 29ECh. 15 - Soto Industries Inc. is an athletic footware...Ch. 15 - Rios Financial Co. is a regional insurance company...Ch. 15 - Forte Inc. produces and sells theater set designs...Ch. 15 - Prob. 4PACh. 15 - Rekya Mart Inc. is a general merchandise retail...Ch. 15 - Prob. 2PBCh. 15 - Glacier Products Inc. is a wholesaler of rock...Ch. 15 - Teasdale Inc. manufactures and sells commercial...Ch. 15 - Selected transactions completed by Equinox...Ch. 15 - Prob. 1CPCh. 15 - Prob. 2CPCh. 15 - Berkshire Hathaway, the investment holding company...Ch. 15 - On July 16, 20Y1, Wyatt Corp. purchased 40 acres...Ch. 15 - International Financial Reporting Standard No. 16...
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Similar questions
- The profits from the sale of listed real estate investment trust ( REIT) shares are typically taxed ?arrow_forward47. Help me selecting the right answer. Thank youarrow_forwardWhen 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)arrow_forward
- Choose the correct.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. A deduction from the investor’s share of the investee’s profits.b. Dividend income.c. A deduction from the stockholders’ equity account, Dividends to Stockholders.d. A deduction from the investment account(AICPA adapted)arrow_forwardWhen an individual owns directly stocks of the company, he has: Group of answer choices a. Direct Financial Interest b. Indirect Financial Interest c. Both Direct and Indirect d. Neither Direct nor Indirectarrow_forwardA dividend which is a return to stockholders of a portion of their original investments is a CHoices; property dividend. liquidating dividend. participating dividend. liability dividend.arrow_forward
- True or false: the investor will be eligible to receive the dividends when he/she buy the company stock on the payment date. Explainarrow_forwardAn investment in an associate is normally accounted for using the equity accounting method. This method requires thatthe investment in the associate is__________.Select one:a.initially recorded at cost and not adjusted thereafterb.initially recorded at cost and then adjusted in each subsequent accounting period to reflect the investor’s share ofthe associate’s profit or loss for the yearc.initially recorded at cost and then adjusted to fair value at each subsequent reporting periodd.initially recorded at fair value and the only adjustments are for dividend income that is declared and paidarrow_forwardWhich of the following may take the form of dividend income and/or capital appreciation? a. bond investments b.gain from an investment c.equity investments d.expected rate of returnarrow_forward
- 35. Help me selecting the right answer. Thank youarrow_forwardAssume that Mr Abdullah has purchased some securities on which he is not entailed to get fixed rate of return. Mr Abdullah gets proportion of profit from the company’s earnings after deducting interest, tax, and preference dividend. These securities are known as; a. Bonds payable b. Equity c. None d. Long term payablearrow_forwardWhich of the following results in a decrease in the investment account when applying the equity method? Purchase of additional common stock by the investor during the current year. Dividends paid by the investor. Share of gross profit on intra-entity inventory sales for the current year. Net income of the investee. Net income of the investor.arrow_forward
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