Question : 21. U.S. GAAP requires which of the following disclosures about marketable : 1245734

21. U.S. GAAP requires which of the following disclosures about marketable securities each period?  
A. The aggregate fair value, gross unrealized holding gains, gross unrealized holding losses, and amortized cost for debt securities held to maturity and for debt and equity securities available-for-sale.
B. The proceeds from sales of securities available-for-sale, and the gross realized gains and gross realized losses on those sales. The statement of cash flows shows the cash expenditures to purchase available-for-sale securities and the cash receipts from maturities and sales of available-for-sale securities.
C. The change during the period in the net unrealized holding gain or loss on securities available-for-sale included in a separate shareholders’ equity account.
D. The change during the period in the net unrealized holding gain or loss on trading securities included in earnings.
E. all of the above

22. The provisions of U.S. GAAP require firms to classify marketable securities into which categories? 
A. Debt securities held to maturity for which a firm has both the intent and the ability to hold to maturity—shown on the balance sheet at an amount based on acquisition cost, but subject to impairment.
B. Debt and equity securities held as trading securities shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
C. Debt and equity securities held as securities available-for-sale shown on the balance sheet at fair value, with unrealized changes in fair value of securities held at the end of the accounting period included in other comprehensive income, and realized changes in fair value included in net income when a firm sells the securities.
D. all of the above
E. choices a and b, only.

23. The provisions of U.S. GAAP require firms to classify marketable securities into the following categories except 
A. debt securities held to maturity for which a firm has both the intent and the ability to hold to maturity—shown on the balance sheet at an amount based on acquisition cost, but subject to impairment.
B. debt and equity securities held as trading securities shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
C. debt and equity securities held as securities available-for-sale shown on the balance sheet at fair value, with unrealized changes in fair value of securities held at the end of the accounting period included in other comprehensive income, and realized changes in fair value included in net income when a firm sells the securities.
D. debt and equity securities held as securities available-for-sale shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
E. none of the above

24. To be classified as a current asset, marketable securities must be readily convertible into cash and 
A. traded on the New York Stock Exchange.
B. must be sold prior to the longer of 6 months or the number of months until fiscal year-end.
C. have a short-term maturity.
D. management must intend to convert the securities to cash when necessary.
E. be issued by the U.S. Treasury.

25. The provisions of IFRS require firms to classify marketable securities into which of the following categories? 
A. Held to maturity investments for which a firm has both the intent and the ability to hold to maturity—shown on the balance sheet at an amount based on acquisition cost, but subject to impairment.
B. Debt and equity securities held as financial assets at fair value through profit or loss, shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
C. Debt and equity securities held as available-for-sale financial assets, shown on the balance sheet at fair value, with unrealized changes in fair value of securities held at the end of the accounting period included in other comprehensive income, and realized changes in fair value included in net income when a firm sells the securities.
D. all of the above
E. choices a and b, only.

26. Which of the following is/are true regarding securities classified as available-for-sale? 
A. they must be tested for impairment and if they are impaired, the firm treats the unrealized loss in Accumulated Other Comprehensive Income as if it were realized.
B. they must be tested for impairment and if they are impaired, the firm treats the unrealized loss in Net Income as if it were realized.
C. they are not tested for impairment and do not effect Accumulated Other Comprehensive Income.
D. they are not tested for impairment and do not effect Net Income.
E. they must be tested for impairment and if they are impaired, the firm treats the unrealized loss in Retained Earnings as if it were realized.

27. The provisions of IFRS require firms to classify marketable securities into which of the following categories except 
A. held to maturity investments for which a firm has both the intent and the ability to hold to maturity—shown on the balance sheet at an amount based on acquisition cost, but subject to impairment.
B. debt and equity securities held as financial assets at fair value through profit or loss, shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
C. debt and equity securities held as available-for-sale financial assets, shown on the balance sheet at fair value, with unrealized changes in fair value of securities held at the end of the accounting period included in other comprehensive income, and realized changes in fair value included in net income when a firm sells the securities.
D. debt and equity securities held as available-for-sale financial assets, shown on the balance sheet at fair value, with changes in fair value of securities held at the end of the accounting period reported each period in net income.
E. choices a and b, only.

28. For financial reporting purposes, acquisition and disposition of trading securities are usually _____ activities.  
A. nonoperating
B. financing
C. investing
D. operating
E. exchange

29. Kerry Corporation acquires the publicly traded debt of Jett Corporation on December 31, Year 1 as a temporary investment of excess cash. The securities mature in 4 years. How will the securities be recorded on Kerry’s December 31, Year 1 financial statement? 
A. as long-term investment in marketable equity securities
B. as current assets-marketable securities
C. as bonds payable
D. as short-term investment in marketable equity securities
E. in a reserve account for future operating cash needs

30. The term _____ implies active and frequent buying and selling with the objective of generating profits from short-term changes in market prices. 
A. gambling
B. mad money
C. conjecture
D. trading
E. ka-ching