Q&A Hero

Q: Golden Age Co. exports Native American artwork to Japan. Prepare journal entries for the following transactions. Nov 10 Sold artwork to Tanaka Company for 10,000,000 yen, terms n/30. The exchange rate was $0.0084 per yen. Dec 5 Received payment from Tanaka Company for the November 10 sale. The exchange rate was $0.009 per yen.

Q: Rhone Importers purchases automotive parts from Germany. Prepare journal entries for the following transactions of Rhone. Oct 1 Purchased inventory from Weimar Co for 12,000 euros, terms n/30. The exchange rate was $1.15 per euro. Oct. 30 Paid Weimar Co. for the October 1 purchase. The exchange rate was $1.13 per euro

Q: On January 1, 2012, Frederich Corporation purchased 7,500 shares of Sport Tech, Inc. as a long-term investment for a total of $235,000. The 7,500 shares represent 30% of the outstanding (25,000) shares of Sport Tech. Prepare the journal entries for Frederich to record the following transactions and events: December 31, 2012 Sport Tech reported net income of $66,000 for 2009. February 1, 2013 Sold 1,875 of the Sport Tech shares for $34 per share. In addition, $1,350 in fees and commissions were paid by Frederich on this sale. November 1, 2013 Frederich received a $0.90 per share cash dividend from Sport Tech. December 31, 2013 Sport Tech reported net income of $146,000 for 2010

Q: Savan Co. purchased 14,000 shares of Briton Corporation's 40,000 shares of common stock on December 31, 2012. This represented 35% of Briton's outstanding shares and gave Savan Co. significant influence over Briton's management and operations. On October 11, 2013, Briton declared and paid cash dividends of $30,000. On December 31, 2013, Briton reported net income of $125,000 for the year. Prepare the journal entries Savan Co. should record to account for its investment in Briton Corporation during 2013.

Q: Kramer Corporation had the following long-term investment transactions. Jan. 2 Purchased 5,000 shares of Optic, Inc. for $42 per share plus $7,000 in fees and commission. These shares represent a 35% ownership of Optic. Oct. 15 Received Optic, Inc. cash dividend of $2 per share. Dec. 31 Optic reported a net loss of $66,000 for the year. Prepare the journal entries Kramer Corporation should record for these transactions and events.

Q: On January 2, Froxel Company purchased 10,000 shares of Sandia Corp. common stock at $19 per share plus a $3,000 commission. This represents 30% of Sandia Corp.'s outstanding stock. On August 6, Sandia Corp. declared and paid cash dividends of $1.75 per share and on December 31 it reported net income of $150,000. Prepare the necessary entries Froxel Company must make to account for these transactions and events.

Q: Detalo Co. held bonds of Schooner Corp. with a cost of $125,000 and a market value of $127,000. Detalo also held 1,500 shares of Tranco common stock with a cost of $25,000 and a market value of $24,700. These are classified as long-term available-for-sale securities. Prepare the journal entry to record the market value of the investments as of December 31.

Q: Chrono Co. held bonds of Ayrford Co. with a cost of $125,000 and a year-end market value of $123,700. Chrono also held 1,500 shares of Avian common stock with a cost of $25,000 and a year-end market value of $26,100. These are classified as long-term available-for-sale securities. Prepare the journal entry to record the market value of the investments as of its December 31 year-end.

Q: Columbia Corp. held 1,500 of Vianco common stock with a cost of $74,387. These shares were classified as a long-term available-for-sale investment. It sold the shares on December 13 for $55,275. Prepare the journal entry to record this sale.

Q: Marina, Inc., held 1,500 of Navia common stock with a cost of $36,900. These shares were classified as a long-term available-for-sale investment. It sold the shares on December 13 for $42,100. Prepare the necessary journal entry to record this sale.

Q: On October 31, Mayfair Co. received cash dividends of $0.15 per share from its investment in Carter Corp.'s common stock. Mayfair owned 1,200 shares of Carter Corp.'s stock on October 31. The investment is considered available for sale. Prepare the investor's journal entry to record the receipt of the cash dividends.

Q: Haladam Company had the following transactions relating to investments in trading securities during the year. Prepare the required general journal entries for these transactions. May 4 Haladam purchased 600 shares of Cob Company stock at $120 per share plus a $750 brokerage fee. July 1 Haladam received a $2.50 per share cash dividend on the Cob Company stock. Sept. 15 Sold 300 shares of the Cob Company stock for $125 per share, less a $450 brokerage fee. Dec. 31 The market value of the Cob Company stock (the only investment that Haladam owns) is $124 per share. The balance of the Market Adjustment Trading a zero balance prior to adjustment.

Q: Wiffery Company had the following trading securities in its portfolio at December 31. The Market Adjustment Trading account had balance of zero prior to year-end adjustment. Prepare the appropriate adjusting journal entry. Short-Term Investments Cost Market Value IBM.................................................................... $ 24,500 $ 25,900 Microsoft............................................................ Intel..................................................................... Dell...................................................................... 51,000 62,300 29,900 48,600 61,000 30,200 Totals $167,700 $165,700

Q: A company had net income of $76,000 in 2012 and $88,000 in 2013. Its net sales were $640,000 in 2012 and $611,000 in 2013. Its average total assets in 2012 were $670,000 and $712,000 in 2013. Calculate the profit margin, total asset turnover, and return on total assets for both years. Comment on the results.

Q: A company reported net income for 2012 of $98,000 and $106,000 in 2013. It also reported net sales of $735,000 in 2012 and $798,000 in 2013. The company's average total assets in 2012 were $1,850,000 and $1,720,000 in 2013. Calculate this company's profit margin, total asset turnover, and return on total assets for 2012 and 2013. Comment on the results.

Q: A company reported net income of $275,000, net sales of $2,500,000, and average total assets of $2,100,000 for the current year. Calculate this company's profit margin, total asset turnover, and return on total assets.

Q: A company had net income of $45,000, net sales of $390,000, and average total assets of $250,000 for the current year. Calculate this company's profit margin, total asset turnover, and return on total assets.

Q: A company had net income of $450,000 in 2012 and $620,000 in 2013. The company had average total assets of $2,500,000 in 2012 and $3,000,000 in 2013. Calculate the return on total assets for 2012 and 2013. Comment on the results.

Q: A company reported net income of $100,000 and average total assets of $425,000. Calculate its return on total assets.

Q: A company paid $500,000 for 12% bonds with a par value of $500,000. The bonds pay 6% interest semiannually on September 1 and March 1. The company intends to hold the bonds until they mature. Prepare the journal entries for the following dates and transactions related to this bond acquisition. (1) Bonds purchased on September 1, 2012. (2) Year-end adjusting entry, December 31, 2012. (3) Receipt of semiannual interest March 1, 2013. (4) Redemption of the bonds at maturity on August 31, 2019.

Q: On April 1 of the current year, a company paid $150,000 to purchase 7%, 10-year bonds that had a par value of $150,000 and paid interest semiannually on October 1 and April 1. The company intends to hold the bonds until they mature. Prepare the journal entry to record the receipt of the semiannual interest payment on April 1 of the following year.

Q: On April 1 of the current year, a company paid $150,000 to purchase 7%, 10-year bonds that had a par value of $150,000 and paid interest semiannually on October 1 and April 1. The company intends to hold the bonds until they mature. Prepare the journal entry to recognize accrued interest as of December 31 of the current year.

Q: On April 1 of the current year, a company paid $150,000 to purchase 7%, 10-year bonds that had a par value of $150,000 and paid interest semiannually each April 1 and October 1. The company intends to hold the bonds until they mature. Prepare the journal entry to record the receipt of the first semiannual interest payment on October 1 of the current year.

Q: On April 1 of the current year, a company paid $150,000 cash to purchase 7%, 10-year bonds that had a par value of $150,000 and paid interest semiannually each April 1 and October 1. The company intends to hold these bonds until they mature. Prepare the journal entry to record the purchase of the bond.

Q: Explain how transactions (both sales and purchases) in a foreign currency are recorded and reported.

Q: Explain how equity securities having significant influence are accounted for and reported in the financial statements. Include a discussion of the criterion for these securities in terms of an investee's voting stock.

Q: Explain how available-for-sale debt and equity securities are accounted for at and after acquisition and how they are reported in financial statements.

Q: Explain how held-to-maturity debt securities are accounted for at and after acquisition and how they are reported in the financial statements.

Q: Identify the three types of classifications for noninfluential investments in securities.

Q: Define the return on total assets and explain how it is used to measure a company's financial performance.

Q: Define the foreign exchange rate between two currencies. Explain its effect on business transactions conducted in a foreign currency.

Q: Explain how investors report investments in equity securities when the investor has a controlling influence over an investee.

Q: What is comprehensive income and how is it usually reported in the financial statements?

Q: What are the accounting basics for equity securities, including acquisition, dividends earned, and disposition?

Q: What are the accounting basics for debt securities, including recording their acquisition, interest earned and their disposal?

Q: Explain the difference between short-term and long-term investments and give examples of each.

Q: 1. A corporation controlled by another company when the parent owns more than 50% of the subsidiary's voting stock. Long-term investments 2. A company that owns a more than 50% controlling interest in a subsidiary. Subsidiary 3. A measure of operating efficiency, computed as net income divided by average total assets. Unrealized gain or loss 4. Debt securities that a company intends and is able to hold until maturity. Consolidated financial statements 5. An accounting method for long-term investments in equity when the investor has significant influence over the investee. Parent company 6. Debt and equity securities not classified as trading or held-to-maturity. Available-for-sale securities 7. Debt and equity securities that a company intends to actively manage and trade for profit. Held-to-maturity securities 8. A change in market value that is not yet realized through an actual sale. Trading securities 9. Investments in equity and debt securities that are not readily convertible to cash or are not intended to be converted to cash in the short term. Return on total assets 10. Financial statements that show the financial position, results of operations and cash flows of all entities under the parent's control, including those of any subsidiaries. Equity method

Q: On November 12, Kera, Inc., a U.S. company, sold merchandise on credit to Kakura Company of Japan at a price of 1,500,000 yen. The exchange rate was $0.00837 on the date of sale. On December 31, when Kera prepared its financial statements, the exchange rate was $0.00843. Kakura Company paid in full on January 12, when the exchange rate was $0.00861. On January 12, Kera should prepare the following journal entry for this transaction: A. Cash................................................................ 12,915 Accounts Receivable Kakura Company.. Foreign Exchange....................................... 12,555 360 B. Cash............................................................... Foreign Exchange Loss............................. 12,555 360 Accounts Receivable Kakura Company. 12,915 C. Cash............................................................... Accounts Receivable Kakura Company. 12,915 12,645 Foreign Exchange Gain............................. 90 D. Cash............................................................... 12,645 Foreign Exchange Loss........................ 90 Accounts Receivable Kakura Company... 12,915 E. Cash................................................................. 12,915 Foreign Exchange Gain........................... 270 Accounts Receivable Kakura Co. 12,645

Q: On November 12, Kendra, Inc., a U.S. Company, sold merchandise on credit to Nakakura Company of Japan at a price of 1,500,000 yen. The exchange rate was $0.00837 per yen on the date of sale. On December 31, when Kendra prepared its financial statements, the exchange rate was $0.00843. Nakakura Company paid in full on January 12, when the exchange rate was $0.00861. On December 31, Kendra should prepare the following journal entry for this transaction: A. Sales................................... 90 Foreign Exchange Gain..... 90 B. Foreign Exchange Loss....... 90 Sales..................................... 90 C. Accounts Receivable Nakakura Company........... 90 Foreign Exchange Gain....................................... 90 D. Foreign Exchange Gain or Loss....................... 90 Accounts Receivable Nakakura Company.... 90 E. No journal entry is required until the amount is collected

Q: On June 18, Johnson Company (a U.S. company) sold merchandise to the Frater Company of Denmark for 60,000 Euros, with a payment due in 60 days. If the exchange rate was $1.14 per euro on the date of sale and $1.35 per euro on the date of payment, Johnson Company should recognize a foreign exchange gain or loss in the amount of: A. $60,000 gain B. $60,000 loss C. $68,400 loss D. $12,600 gain E. $12,600 loss

Q: When a credit sale is denominated in a foreign currency, the foreign exchange rate used to record the sale is the current exchange rate: A. Thirty days from the date of sale. B. At the end of the seller's fiscal year. C. At the end of the buyer's fiscal year. D. On the date final payment is made. E. On the date of the sale.

Q: A U.S. company makes a sale to a foreign customer payable in 30 days in the customer's currency. The sale would be recorded by the U.S. company on the date: A. Of sale using a projected estimate of the U.S. dollar value at payment date. B. Of sale using a 30-day average U.S. dollar value. C. Of sale using the current dollar value. D. Of sale using the foreign currency value. E. When payment is received.

Q: The price of one currency stated in terms of another currency is referred to as the: A. Historical exchange rate B. Foreign exchange rate C. Consolidated exchange rate D. General exchange rate E. Multinational exchange rate

Q: On January 1, 2011, Posten Company purchased 10,000 shares of Toma Company for $78,000 plus a broker's fee of $2,000. Toma Company has a total of 40,000 shares of common stock outstanding and it is presumed the Posten Company will have a significant influence over Toma. Toma declared and paid cash dividends of $0.93 per share in 2011 and 2012. Toma's net income was $190,000 and $270,000 for 2011 and 2012 respectively. The January 1, 2013, entry on the books of Posten Company to record the sale of 4,500 shares of Toma Company stock for $85,000 cash should be: A) Cash 85,000 Loss on Sale of Investments 110,000 Long-Term Investments 195,000 B) Cash 85,000 Gain on Sale of Investments 57,370 Long-Term Investments 27,630 C) Cash 85,000.00 Gain on Sale of Investments 76,195.75 Long-Term Investments 8,804.25 D) Cash 85,000 Gain on Sale of Investments 5,620 LongTerm Investments 79,380 E) Cash 85,000 Gain on Sale of Investments 5,000 LongTerm Investments 80,000

Q: On January 4, 2011, Larsen Company purchased 5,000 shares of Warner Company for $59,500 plus a broker's fee of $1,000. Warner Company has a total of 25,000 shares of common stock outstanding and it is presumed the Larsen Company will have a significant influence over Warner. During each of the next two years, Warner declared and paid cash dividends of $0.85 per share. Its net income was $72,000 and $67,000 for 2011 and 2012, respectively. The January 12, 2013, entry to record the sale of 3,000 shares of Warner Company stock for $39,000 cash should be: A. Cash......................................................... 39,000 Loss on Sale of Investments................... 2,400 Long-Term Investments................. 41,400 B. Cash......................................................... 39,000 Loss on Sale of Investments................... 8,800 Long-Term Investments................... 47,880 C. Cash......................................................... 39,000 Loss on Sale of Investments................... 60 Long-Term Investments.................. 38,940 D. Cash......................................................... 39,000 Gain on Sale of Investments.............. 8,750 Long-Term Investments.................... 30,250 E. Cash......................................................... 39,000 Loss on Sale of Investments................... 21,500 Long-Term Investments................... 60,500

Q: Clark Corporation purchased 40% of IT corporation for $125,000 on January 1. On May 20 of the same year, IT Corporation declared total cash dividends of $30,000. At year-end, IT Corporation reported net income of $150,000. The balance in Clark Corporation's Long-Term Investment in IT Corporation account as of December 31 should be: A. $77,000 B. $125,000 C. $173,000 D. $197,000 E. $370,000

Q: Parris Corporation purchased 40% of Samitz Corporation for $100,000 on January 1. On November 17 of the same year, Samitz Corporation declared total cash dividends of $12,000. At year-end, Samitz Corporation reported net income of $60,000. The balance in the Parris Corporation's Long-Term Investment in Samitz Corporation at December 31 should be: A. $80,800 B. $100,000 C. $95,200 D. $119,200 E. $124,000

Q: Chung owns 40% of Lu's common stock. Lu pays $97,000 in total cash dividends to its shareholders. Chung's entry to record this transaction should include a: A. Debit to Dividends for $97,000. B. Debit to Dividends for $38,800. C. Debit to Long-Term investments for $97,000. D. Credit to Long-Term Investments for $38,800. E. Credit to Cash for $97,000.

Q: Micron owns 35% of Martok. Martok pays a total of $47,000 in cash dividends for the period. Micron's entry to record the dividend transaction would include a: A. Credit to Long-Term Investments for $16,450. B. Debit to Long-Term Investments for $16,450. C. Debit to Cash for $47,000. D. Credit to Cash for $16,450. E. Credit to Investment Revenue for $47,000.

Q: If a company owns more than 20% of the stock of another company and the stock is being held as a long-term investment, which method would the investor normally use to account for this investment? A. Equity method B. Market value method C. Historical cost method D. Straight-line method E. Effective method

Q: Vans purchased 40,000 shares of Skechers common stock for $232,000. This represents 40% of the outstanding stock. The entry to record the transaction includes a: A. Debit to Long-Term Investments for $92,800. B. Debit to Long-Term Investments for $232,000. C. Credit to Long-Term Investments for $92,800. D. Credit to Long-Term Investments for $232,000. E. Debit to Long-Term Investment for $40,000.

Q: A company had investments in long-term available-for-sale securities. At the end of the current year, the company's portfolio had a $731,000 cost and $730,000 market value. What is the current year's adjustment to market value given the following account balances at the end of the prior year? Market Adjustment Available-for-Sale Unrealized Gain (Loss) Equity 5,000 5,000 A. Market Adjustment Available-for-Sale............... 1,000 Unrealized Gain Equity.......................................... 1,000 B. Market Adjustment Available-for-Sale............... 6,000 Unrealized Gain Equity.......................................... 6,000 C. Unrealized Gain Equity.......................................... 1,000 Market Adjustment Available-for-Sale............... 1,000 D. Unrealized Gain (Loss) Equity.......................................... 6,000 Market Adjustment Available-for-Sale............... 6,000 E. Unrealized Gain (Loss) Equity.................................. 4,000 Market Adjustment Available-for-Sale............... 4,000

Q: A company had investments in long-term available-for-sale securities. At the end of the current year, the company's portfolio had a $162,000 cost and $164,000 market value. What is the current year's adjustment to market value given the following account balances at the end of the prior year? Market Adjustment Available-for-Sale Unrealized Gain Equity 3,000 3,000 A. Market Adjustment Available-for-Sale............... 2,000 Unrealized Gain Equity.......................................... 2,000 B. Market Adjustment Available-for-Sale............... 1,000 Unrealized Gain Equity.......................................... 1,000 C. Unrealized Gain Equity.......................................... 1,000 Market Adjustment Available-for-Sale............... 1,000 D. Unrealized Gain Equity.......................................... 2,000 Market Adjustment Available-for-Sale............... 2,000 E. Unrealized Gain Equity.......................................... 3,000 Market Adjustment Available-for-Sale............... 3,000

Q: Acme owns 4,000 shares of XYZ. XYZ has 50,000 total shares of stock outstanding. XYZ paid $0.82 per share in cash dividends to its stockholders. Acme should record a: A. Debit to Dividends for $41,000. B. Debit to Dividends for $3,280. C. Debit to Cash for $3,280. D. Debit to Long-Term Investments for $3,280. E. Credit to Long-Term Investments for $3,280.

Q: Micron owns 3,000 shares of JVT. JVT has 25,000 total shares of stock outstanding. JVT paid $3 per share in cash dividends to its stockholders. Micron should record a: A. Debit to Dividends for $75,000. B. Debit to Dividends for $9,000. C. Debit to Cash for $9,000. D. Debit to Long-Term Investments for $9,000. E. Credit to Long-Term Investments for $9,000.

Q: Morgan Company purchased 2,000 shares of Asta's common stock for $143,000 as a long-term investment and is considered available-for-sale. The par value of the stock was $1 per share. Morgan paid $375 in commissions on the transaction. The entry to record the transaction would include a: A. Credit to Common Stock for $2,000. B. Credit to Common Stock for $143,000. C. Credit to Common Stock for $143,375. D. Debit to Long-Term Investments for $143,000. E. Debit to Long-Term Investments for $143,375.

Q: Available-for-sale debt securities are: A. Recorded at cost and remain at cost over the life of the investment. B. Reported at historical cost, adjusted for the amortized amount of any difference between cost and maturity value. C. Reported at market value on the balance sheet. D. Intended to be held to maturity. E. Always classified with Long-Term Liabilities.

Q: Held-to-maturity securities are: A. Always classified as long-term liabilities. B. Part of equity. C. Debt securities that a company intends and is able to hold to maturity. D. Equity securities that a company intends and is able to hold to maturity. E. Equity securities that have a maturity value greater than cost.

Q: Investments in debt and equity securities that the company actively manages and trades for profit are referred to as short-term investments in: A. Available-for-sale securities. B. Held-to-maturity securities. C. Trading securities. D. Realizable securities. E. Liquid securities.

Q: A decrease in the fair market value of a security that has not yet been realized through an actual sale of the security is called a(n): A. Contingent loss B. Realizable loss C. Unrealized loss D. Capitalized loss E. Market loss

Q: Investments in trading securities: A. Include only equity securities. B. Are reported as current assets. C. Include only debt securities. D. Are reported at their cost, no matter what their market value. E. Are long-term investments.

Q: A company's return on total assets equals 28%. If total assets and net sales are $4,500,000 and $10,000,000 respectively, how much is net income? A. $2,800,000 B. $4,060,000 C. $1,260,000 D. $14,500,000 E. $2,030,000

Q: A company's return on total assets equals 30%. If net income and net sales are $900,000 and $8,900,000 respectively, what is the amount of total assets? A. $2,670,000 B. $270,000 C. $29,666,667 D. $3,000,000 E. $2,940,000

Q: A company had net income of $82,000, net sales of $781,000, and average total assets of $300,000. Its profit margin and total asset turnover were respectively: A. 10.5%; 0.38 B. 10.5%; 2.6 C. 9.52%; 2.6 D. 27.3%; 1 E. 27.3%; 9.52

Q: A company had net income of $40,000, net sales of $300,000, and average total assets of $200,000. Its profit margin and total asset turnover were respectively: A. 13.3%; 0.2 B. 13.3%; 1.5 C. 2.0%; 1.5 D. 1.5%; 0.2 E. 1.5%; 13.3

Q: A company had net income of $43,000, net sales of $380,500, and average total assets of $220,000. Its profit margin and total asset turnover were, respectively: A. 11.3%; 1.73 B. 11.3%; 19.5 C. 1.7%; 19.5 D. 1.7%; 11.3 E. 19.5%; 11.3

Q: A company had net income of $2,785,000, net sales of $250,000,000, average total assets of $6,000,000, and equity investments of $40,000. Its return on total assets equals: A. $3,215,000 B. 41.67% C. 21.54% D. 69.63% E. 46.42%

Q: A company had net income of $2,660,000, net sales of $25,000,000, and average total assets of $8,000,000. Its return on total assets is equal to: A. 3.01% B. 10.64% C. 32.00% D. 33.25% E. 300.75%

Q: A company has net income of $250,000, net sales of $2,000,000, and average total assets of $1,500,000. Its return on total assets is equal to: A. 12.5% B. 13.3% C. 16.7% D. 75.0% E. 600.0%

Q: Doherty Corporation had net income of $30,000, net sales of $1,000,000, and average total assets of $500,000. Its return on total assets is equal to: A. 3% B. 200% C. 6% D. 17% E. 1.5%

Q: Return on total assets measures a company's ability to: A. Produce net income from net sales. B. Produce sales from net assets. C. Produce net income from net assets. D. Increase its asset base from sales. E. Increase its asset base from net income.

Q: The currency in which a company presents its financial statements is known as the: A. Multinational currency B. Price-level-adjusted currency C. Specific currency D. Reporting currency E. Historical cost currency

Q: The price of one currency stated in terms of another currency is called a(n): A. Foreign exchange rate B. Currency transaction C. Historical exchange rate D. International conversion rate E. Currency rate

Q: Long-term investments in held-to-maturity debt securities are accounted for using the: A. Market value method with market adjustment to income. B. Market value method with market adjustment to equity. C. Cost method with amortization. D. Cost method without amortization. E. Equity method.

Q: Short-term investments in held-to-maturity debt securities are accounted for using the: A. Market value method with market adjustment to income. B. Market value method with market adjustment to equity. C. Cost method with amortization. D. Cost method without amortization. E. Equity method.

Q: A controlling influence over the investee is based on the investor owning voting stock exceeding: A. 10% B. 20% C. 30% D. 40% E. 50%

Q: Consolidated financial statements: A. Show the results of operations, cash flows, and the financial position of all entities under a parent's control. B. Show the results of operations, cash flows, and the financial position of the parent only. C. Show the results of operations, cash flows, and the financial position of the subsidiary only. D. Include the investments account on the balance sheet. E. Do not include a balance sheet.

Q: In accounting for noninfluential securities: A. The GAAP concept of trading securities is commonly referred to as financial assets at fair value through profit and loss under IFRS. B. The IFRS concept of trading securities is commonly referred to as financial assets at fair value through profit and loss under GAAP. C. The GAAP concept of available-for-sale securities is commonly referred to as available-for-sale financial assets under IFRS. D. The IRFS concept of available-for-sale securities translates as available-for-sale financial assets under GAAP. E. Both A and C above are true statements.

Q: The controlling investor is referred to as the: A. Owner B. Subsidiary C. Parent D. Investee E. Senior entity

Q: Accounting for long-term investments in equity securities with controlling influence uses the: A. Controlling method. B. Equity method with consolidation. C. Investor method. D. Investment method. E. Consolidated method.