account - Comm 310 Winter 2011 Assignment 3 Chap 9 - 12 -...

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Comm 310 Winter 2011 Assignment 3 Chap 9 - 12 - 15% P a g e | 1 1. Comprehensive income is included as part of a. retained earnings. b. net income. c. shareholders’ equity. d. unearned revenue. 2. An investment that is intended to be held for three years should generally be classified as a(n) a. Long term asset b. Equity investment c. Temporary investment d. None of these 3. Comprehensive income includes a. Changes in equity related to non-owner sourced transactions. b. Changes in equity related to funds received from owners or shareholders. c. Other comprehensive income d. All of these 4. An investor who has subsidiaries a. Is required to prepare consolidated financial statements under IFRS b. Has the option to prepare consolidated financial statements under PE GAAP c. None of these d. (a) and (b) 5. If the parent company owns 90% of the subsidiary company’s outstanding shares, the company should generally account for the subsidiary's income under the a. Cost/amortized cost model b. Fair value to net income model c. The equity method d. The consolidation method 6. Which of the following does not describe a financial asset? a. Cash b. A contractual right to receive cash c. An equity instrument of another entity d. None of these 7. Russin, Inc. owns bonds that are accounted for under the fair value to net income model. The bonds have a carrying value of $124,365 on December 31, 2011. The fair value at that date is $123,000. The entry to record the year-end adjustment is a. Loss on Investments. .......................................................................... 1,365 Investments. .............................................................................. 1,365 b. no adjustment required. c. Unrealized Holding Loss on (OCI). ................................................... 1,365 Investments. .............................................................................. 1,365 d. Investments. ....................................................................................... 1,365 Unrealized Holding Gain on Available-for-Sale Investments (OCI) 1,365
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Comm 310 Winter 2011 Assignment 3 Chap 9 - 12 - 15% P a g e | 2 8. If Nolte Company acquired a 30% interest in Boswell Company on December 31, 2011 for $67,500 and during 2012 Boswell Company had net income of $25,000 and paid a cash dividend of $10,000, applying the equity method would give a debit balance in the Investment in Boswell Company account at the end of 2012 of a. $72,000. b. $67,500. c.
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This note was uploaded on 04/05/2011 for the course COMMERCE 210 taught by Professor Mike during the Spring '11 term at The University of British Columbia.

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account - Comm 310 Winter 2011 Assignment 3 Chap 9 - 12 -...

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