true or false

46. Which statement regarding investments in equity securities is incorrect?

A) Significant influence equity investments are always reported as long-term assets on the balance sheet.

B) Significant influence equity investments are consolidated into the investor's financial statements.

C) Investments in equity securities are classified into three specific types based on the investor's level of influence over the investee company.

D) Generally, no significant influence exists if there is an ownership interest of less than 20% of the investee's voting stock.

47. Which of the following will be classified as an available-for-sale debt investment?

A) debt securities which the investor intends to sell in the very near future

B) debt securities the investor intends to hold and has the ability to hold until they mature

C) all investments in Treasury bills

D) all debt securities that are not trading debt investments or held-to-maturity debt investments48

48. Significant influence equity investments are reported as ________ on the balance sheet.

A) current assets

B) either current assets or current liabilities

C) long-term assets

D) either current assets or long-term assets

49. When a company acquires a long-term bond investment, by paying cash, total assets remain unchanged.

50. Investments in debt securities are recorded at cost. Brokerage fees paid are treated as expenses.

51. When a company pays cash for a long-term investment in bonds; A) equity remains unchanged B) current assets increase C) liabilities increase D) total assets increase

52. The balance sheet shows why cash increased or decreased.

53. The statement of cash flows shows where cash came from and how cash was spent.

54. A business's cash receipts and cash payments for a specific period are reported on a(n). A) income statement B) balance sheet C) statement of cash flows D) cash reconciliation statement

55. The statement of cash flows explains why net income as reported on the income statement does not equal the change in the cash balance.

56. Which of the following statements accurately describes the statement of cash flows?

A) It shows the relative proportion of debt and assets.

B) It is the link between the accrual-based income statement and the cash reported on the balance sheet.

C) It indicates when long-term debt will mature.

D) It is the link between net income and earnings per share.