Investments
eliminated
Amounts that are shared between the parent and subsidiary must be
cost
Andrea Company purchases 30% of Sander Company's outstanding stock
cost
At the time of acquisition, an investment in a discounted bond is recorded at
cost
Consistent waws IAS No. 39
amortized cost
Consistent with IFRS No.9, investments in debt securities can be classified
security and index
Derivatives are financial instruments that derive their values from some other
higher
During the current period, Muenster Company amortized $5000
financial
Equity and debt securities are common referred to as
risk and stable
Hedging insulates a company from
lacks and influence
Held-to-maturity, trading, and available-for-sale are possible classifications
income statement, occur
Holding gains and losses realti
discount
If a bond sells for less than its maturity value, the bond sells at a
irrevocable
If a company to apply the fair value option to an investment that otherwise would be
outstanding and effective
Interest earned on investment in debt instruments is calculated by multiplying
amortized cost
Investments classified as held to maturity should be carried at
market
Investors utilize the ___ interest rate to value the stream of cash flows
fair value
Kuhn Company purchases an investment in equity securities and lacks
controls
Purpose Company owns 60% of the outstanding shares of Goal Company.
accrual
Recognizing interest revenue is consistent with the
twenty
Significant influence is typically assumed if the investor owns at least
mixture
The average cost method assumes that cost of goods sold and ending
historical cost
The fair value method represents a departure from the
estimate
The gross profit method allows companies to
amortized cost
The initial fair value adjustment for debt securities classified as trading securities is calculated
risk and maturity
The market interest rate is determined with reference to investments with similar
relationship and investee
The method for reporting an investment in the stock of another company
present and future
The price of a bond is equal to the
cost, fair value
Trading securities are initially recorded at
other comprehensive
Unrealized holding gains and losses on available-for-sale
significant influence
Von Company properly applies the equity method in accounting for its investment
trading
When the fair value option is chosen, all securities are classified
fair value
at the date of acquisition, the subsidiary's assets are valued at
fair value
at the end of the accounting period, trading securities must be adjusted to
face
at the maturity date, the carrying value of a discounted investment
interest and principal
bonds typically provides two sources of cash flows to investors
operating
cash flows from buying and selling trading securities typically are classified as
stated
cash interest is calculated with reference to the
restatement
changes to the equity method require financial statement
net income, equity, owners
comprehensive income includes ___, as well as all other changes in
Investment Revenue
earned on an investment in trading debt securities is calculated
irrevocable
election of the fair value options is
control
for the purpose of choosing the appropriate reporting method for investing
fair value
goodwill represents the difference between the cost of the investment
decrease
if an investee company reports a net loss, the investor's equity method
consolidated
if an investor controls the operating and financial policies of another entity, it should
cost
if the fair value of an equity is not readily determinable, the
market
interest revenue is calculated based on the
fair value
investments in trading securities are reported on the balance sheet
asset
the "discount on bond investment" account is a
significant influence
the determining factor that affects financial accounting and reporting for investment
control
the factor that determines accounting for investments is the
relevance
the fair value method is justifiable because it enhances the
holding
the key difference between the three investment categories lies in the reporting
equity
the presumption that the fortunes of the
consolidated
the purpose of additional adjustments under the equity method is to adjust for differences between
dividends
under the equity method, the distribution
net income
under the fair value option, unrealized gains and losses on investment
maturity and matures
unlike an equity security, a debt security has a
equity
winston company has significant influence over the operating and financial