Week 4 Quiz Review – Chapter 12

Here are the topics covered on the quiz. You should know the
following:

1. Accounting for unrealized gain or loss on investments held as

either trading securities or available for sale – including whether
or not to include in income
2. Amount to report on balance sheet for an investment if know
percentage owned, dividends paid, net income for the year, etc.
3. How to record dividends received on investments, and how
percentage of ownership can affect manner in which transaction
is handled
4. Reporting a gain on an equity security using the cost method
5. Treatment of additional depreciation due to differences between
book values and fair values of investee assets on the date of
acquisition, using equity method
6. Application of FASB 115 in context of percentage of ownership
7. Which type of securities include/exclude equity securities, and
for which type would a change in its fair value be reflected in
the shareholders’ equity section of the balance sheet
8. When to report securities at cost, amortized cost, consolidated
value or net present value (if applicable)