Intermediate Accounting Volume 1, 7th Edition By Spiceland – Test Bank
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Student: ___________________________________________________________________________
| 1. | It is not possible to have control over another company without owning at least half of the outstanding voting shares.
True False |
| 2. | It is not possible to have significant influence over another corporation without owning at least 25% of the outstanding voting shares.
True False |
| 3. | Fair-value-through-profit-and-loss (FVTPL) investments are usually held for the purpose of resale in the near-term.
True False |
| 4. | Amortized cost investments must have contractual terms that give rise to cash flows on specific dates.
True False |
| 5. | The intent to control overrides the ability to do so when determining whether control exists (and henceforth consolidation is required).
True False |
| 6. | Investments designated as FVTPL may be debt or equity instruments, while FVTOCI may include only equity instruments.
True False |
| 7. | Only FVTPL and amortized cost investments are considered passive investments.
True False |
| 8. | Impairment tests are required for all investments except those designated FVTPL.
True False |
| 9. | A bond that is not managed as part of an actively traded portfolio and not held solely to correct its contractual cash flows would be classified as FVTOCI under IFRS.
True False |
| 10. | Realized gains and losses on the sale of equity instruments that are designated FVTOCI must be reclassified from AOCI to earnings.
True False |
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