Which is not a strategic reason to invest a there has

47. Which is not a strategic reason to invest?
a. There has been a change in the economic climate.
b. To establish a presence in a related industry.
c. To exercise some influence over a customer or supplier.
d. To enter a new industry without starting from scratch.
Ans: A, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Strategic/Critical Thinking, AICPA FC: Risk Analysis, AICPA PC: Project
Management, IMA: Investment Decisions
48. Which of the following is a debt security?
Investment Decisions
49. Mazzeo Company acquires 80 Dodd’s 10%, 5 year, $1,000 bonds on January 1, 2022 for
$80,000. The journal entry to record this investment includes a debit to
Problem Solving, IMA: FSA
50. Mazzeo Company acquires 80 Dodd’s 10%, 5 year, $1,000 bonds on January 1, 2022 for
$80,000. Assume Dodd’s pays interest annually on January 1. Mazzeo’s journal entry at
December 31, 2022 would include a credit to
51. Mazzeo Company acquires 80 Dodd’s 10%, 5 year, $1,000 bonds on January 1, 2022 for
$80,000. If Mazzeo sells all of its Dodd’s Bonds for $78,900 what gain or loss is
recognized?
a. Loss of $9,100
b. Loss of $1,100
c. Gain of $1,100
d. Gain of $9,100
Ans: B, LO: 1, Bloom: AP, Difficulty: Medium, Min: 2, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Measurement, AICPA PC:
Problem Solving, IMA: FSA
Solution: $78,900  $80,000  $1,100
(Sell.pr.  inv. cost)