ACCT 1020, Test subn.nary pprent b· influence over the Investes 18% 28% 40% 52%

Question

ACCT 1020, Test subn.nary pprent b· influence over the Investes 18% 28% 40% 52% Short-term investments ero 'espor'nd in shsst a. curront assot seotion of the bulano b. intangible assot section of the baianse sset c. equity section of the balance shest d. gain section of the income statement A decrease in the fair value of a soourity thiat has not yet bssn se 8. contingent loss b. unrealized loss c. capitalized loss d. unrealized gain Available for sale debt securitios a. b. 9. may be classified as short-term investments may be classified as long-term investments are reported at market value on the balancs sheet all of the above c. d. 10. Of the following, which one affects cash during a perid a. the declaration of dividends b. writing off an uncollectible account recsivabls c. the payment of interest expense accrued in a preious onting s d. all of the above . The statement of cash flows reports a. assets, liabilities, and equity gains, expenses, and losses c. the sources and uses of cash for an accounting perod d. changes in equity Swanson Page 2 of 9

Explanation / Answer

5)correct option is "C" -Parent

Controlling interest is gained when a parent company acquires more than 50% shares of subsiduary company

6)correct option is "B" - 20%

when an investor holds 20% or more it acquires significant influence

7)correct option is "A" -Current asset

current asset are those asset that are readily convertible in to casg (highly liquid) and short term investment is one of the example to it.

8)correct option is "B"-Unrealized loss

Decrease in fair value of security until it is sold is debited to unrealized loss on security,/investment

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