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Unformatted text preview: C HAPTER 14 Investments in Debt and Equity Securities M ULTIPLE C HOICE Q UESTIONS Theory/Definitional Questions 1 Definition of available-for-sale securities 2 Reporting of changes in fair value of securities in the income statement 3 Reporting of changes in fair value of securities on the balance sheet 4 Definition of held-to-maturity securities 5 Accounting for available-for-sale securities 6 Application of FASB Statement No. 115 7 Accounting for investments in common stock using the cost method 8 Accounting for trading securities 9 Accounting for goodwill amortization 10 Using the fair market value of stock received as a basis for valuation 11 Accounting for available-for-sale securities 12 Application of the equity method to account for investments in common stock 13 Accounting for goodwill amortization 14 Accounting for trading securities 15 Application of the equity method to account for investments in common stock 16 Application of the equity method to account for investments in common stock 17 Accounting for available-for-sale securities 18 Use of consolidated financial statements 19 Accounting for trading securities 20 International vs. U.S. GAAP for investments in securities 21 Disclosures related to investments in securities 22 Using the cost method to account for an investment 23 Effect of using cost method when equity method was appropriate 24 Reclassification of available-for-sale securities to trading securities Computational Questions 21 22 Chapter 14 Investments in Debt and Equity Securities 25 Computation of dividend revenue 26 Computation of investment income on available-for-sale securities 27 Computation of investment income on available-for-sale securities 28 Computation of balance in investment account on trading securities 29 Computation of carrying value of portfolio on balance sheet 30 Computation of unrealized loss related to securities transactions 31 Determine entry to record sale of a security 32 Computation of loss transfer of securities to determine net income 33 Record corresponding charges against unrealized losses 34 Computation of carrying value of investment in common stock 35 Computation of income on long-term investment 36 Computation of investment in common stock affected by goodwill amortization 37 Computation of "Share of Net Income" of investment affected by goodwill amortization 38 Determination of journal entry for temporary investment 39 Computation of investment loss on trading securities 40 Determination of credit to "Market Adjustment--Trading Securities" account 41 Computation of unrealized loss on trading securities on income statement 42 Computation of loss on securities investment on income statement 43 Computation of realized loss on short-term investment of marketable equity securities 44 Computation of value of acquisition of bonds P ROBLEMS 1 Prepare journal entries relating to investments in common stock 2 Determine journal entries for trading and available-for-sale securities...
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- Spring '10
- ........., Trading Securities.