33 Free Test Bank for Advanced Accounting 2nd Edition by Hamlen
33 Free test bank for Advanced Accounting 2nd Edition by Hamlen Multiple Choice Questions prepare students to enhance understanding and familiarize them with the information presented in real financial situations. Here are free concise questions along with clear answers on advanced accounting which improve your accounting work.
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IFRS for intercorporate investments: Under current standards, an IFRS company will report impairment losses on AFS and HTM investments when
U.S. GAAP for equity method investments: Following U.S. GAAP, when should a company use the equity method to report an intercorporate investment?
Controlling investment: A company acquires all of the assets and liabilities of another company. Which one of the following increases the amount of goodwill the acquiring company reports?
IFRS for impairment of HTM investments: A debt security carried at amortized cost with a book value of $4,000,000 is determined to be impaired in 2014 and is written down to $1,000,000. In 2015, the investment’s value increases to $5,500,000. In 2015, following IFRS,
HTM investment: On its 2015 balance sheet, Ola reports the investment at
IFRS for joint ventures: As of 2013, IFRS requires joint ventures to be reported as
IFRS for intercorporate investments: IFRS 9 for financial instruments, not yet effective, changes how financial instruments are reported. What is one of the provisions of IFRS 9?
IFRS for intercorporate investments: What is “value-in-use,” as used in reporting intercorporate investments, per IFRS?
Equity method investments: Equity in net income is affected by all but which one of these items related to the investee?
Equity method investments: Peregrine Company acquires 30% of the voting stock of Falcon Corporation for $6,000,000 on January 1, 2014. At the time, the book value of Falcon was $20,000,000. During 2014 Falcon reported net income of $2,000,000 and paid dividends of $500,000. Both companies have December 31 year-ends. What is the investment balance on Peregrine’s balance sheet on December 31, 2014?
HTM securities: Held-to-maturity investments are reported at
HTM investment: On its 2014 income statement, Ola reports interest revenue on the corporate bond of
Accounting for HTM securities: A company holds a $100,000 face value corporate bond, bought January 1, 2013, paying 4% annually on December 31, and maturing December 31, 2016. The company paid $93,070 for the bond, to yield 6%. The company categorizes the bond as a held-to-maturity investment, and its accounting year ends December 31. What amount will the company report as interest revenue on the bond for 2014?
Statutory merger: Rand Corporation acquires all of Southern Company’s assets and liabilities on January 1, 2014, for $15,000,000 in cash. At the date of acquisition, Southern’s balance sheet reported assets of $75,000,000 and liabilities of $65,000,000. Investigation reveals that Southern’s reported plant assets are overvalued by $1,400,000. Rand reports how much goodwill on this acquisition?
Equity method investments: Impairment losses on equity method investments are
Impairment of AFS securities: The impairment loss on AFS securities is calculated as
Trading investment: On December 20, 2013, a company pays $40,000 for a stock, classified as a trading security. On December 31, 2013, the company’s year-end, the stock has a market value of $38,000. The company sells the stock in 2014 for $41,000. On its income statement, the company reports
IFRS for equity method investments: Following IFRS, when should a company use the equity method to report an intercorporate investment?
Impairment testing of investments: Impairment testing requires a comparison of an asset’s book value with its fair value, with impairment losses reported on the income statement. Which of the following investments are NOT tested for impairment?
HTM investment: On its 2014 balance sheet, Ola reports the investment at
Stock acquisition: A company acquires all of the voting stock of Previn Company, and records the transaction by debiting “Investment in Previn Company.” The company is accounting for its investment as a
Equity method investments: The U.S. GAAP impairment test for equity method investments requires recognition of impairment losses when
Impairment of HTM investments: A held-to-maturity investment with a book value of $4,000,000 is determined to be impaired in 2014 and is written down to $1,000,000. In 2015, the investment’s value increases to $5,500,000. In 2015, following U.S. GAAP,
HTM investment: What is the life of this bond?
Investment valuation: If a company elects the fair value option under ASC Topic 825 for all of its eligible investments, which of its investments are not reported at fair value, with unrealized gains and losses reported in income?
Joint ventures: If a U.S. company invests in a joint venture, it may report the investment as
AFS investment: On December 20, 2013, a company pays $40,000 for a stock, classified as an available-for-sale security. On December 31, 2013, the company’s year-end, the stock has a market value of $38,000. The company sells the stock in 2014 for $41,000. On its income statement, the company reports
Controlling investment: A company acquires all of the assets and liabilities of another company in a statutory merger. Which statement is false?
Impairment testing of AFS securities: A U.S. company holds available-for-sale securities that it reports at fair value. It determines that previously reported declines in value are “other than temporary.” The effect of this decision is to
IFRS for joint ventures: Which of the following statements is true concerning proportionate consolidation for joint ventures?
IFRS for intercorporate investments: Following IFRS, when are held-to-maturity investments considered to be impaired?
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