ACCTG322 - Exam 1 Sheet

ACCTG322 - Exam 1 Sheet - Chapter12 Ifthefairvalueo

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Chapter 12 The income statement reports changes in fair value for Trading Securities . The shareholders’ equity section of the balance sheet reflects changes in the fair value of Securities Available for Sale . Held-to-Maturity Securities      completely exclude equity securities. If the fair value of equity securities is not determinable and the equity method is not appropriate, the securities should be reported at Cost . Investments in securities to be held for an unspecified period of time are reported at Fair Value . All investment securities are initially recorded at Cost . For trading securities, unrealized holding gains and losses are included in earnings on each reporting date . On the statement of cash flows, inflows and outflows of cash from buying and selling available for sale securities are considered investing   activities. The equity method of accounting for investments in voting common stock is appropriate when the investor can significantly influence the   investee .
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