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Flashcards in Investments Deck (11)
1

Debt and equity securities bought and held principally for the purpose of selling them are called AFS securities. TF

False. Trading securities.

2

Debt securities that the org has a positive intent and ability to hod to the maturity date are called HTM securities. TF

True

3

AFS securities are debt and equity securities not classified as trading or HTM. TF

True

4

Trading and AFS securities are reported at amortized cost on the balance sheet. TF

False, at FMV.

5

HTM securities are reported at amortized cost on the balance sheet. TF

True

6

Trading securities unrealized gains are recored in EARNINGS in the period they occur. TF

True

7

AFS securities unrealized gains are recored in EARNINGS in the period they occur. TF

False, the are EXCLUDED from earnings and reported as OCI unless the decline is considered to be other than temporary.

8

HTM securities unrealized gains are recored in EARNINGS in the period they occur. TF

False, the are EXCLUDED from earnings and reported as OCI unless the decline is considered to be other than temporary.

9

Investments with SIGNIFICANT INFLUENCE hold what % of equity in a company?

>20%, must use equity method of accounting

10

If a company owns over 50% of the voting shares of another company which acctg treatment must be used?

The financials must be consolidated.

11

Under the equity method dividends are treated as income. TF

False.