Which of the following statements best describes the term "significant influence"?

On January 1 of the current year, an entity purchased 10% of another entity's ordinary shares. The entity purchased additional shares bringing ownership up to 40% on August 1 of the current year. During October of the current year, the investee declared and paid a cash dividend on all of the outstanding ordinary shares. How much income from the investment should the entity report for the current year?

An investor uses the cost method for 15% ownership in an investee. At year-end, the investor has a receivable from the investee. How should the receivable be reported in the investor's year-end financial statements?

An investor uses the cost method to account for investment in ordinary shares. Dividends received in excess of the investor's share of the investee's earnings subsequent to the date of investment

When an investor uses the cost method to account for the investment in ordinary shares, cash dividends received by the investor from the investee should be recorded as

When an investor purchases sufficient ordinary shares to gain significant influence over the investee, what is the proper accounting treatment of any excess of cost over carrying amount of net assets acquired?

An investor uses the equity method to account for 30% investment. Amortization of the investor's share of the excess of fair value over carrying amount of depreciable assets at the date of the purchase shall be reported in the investor's income statement as part of

An investor uses equity method to account for purchase of another entity's ordinary shares at the beginning of the current year. On the date of acquisition, the fair value of the investee's inventory and land exceeded carrying amount. How would the inventory and land excess affect respectively the investor's reported equity in earnings of the investee for the current year?

An investor uses the equity method to account for investment in ordinary shares. The purchase price implies a fair value of the investee's depreciable assets in excess of the investee's net assets carrying values. The investor's amortization of the excess

An investor uses the equity method for 30% of the ordinary shares of another entity. In the current year, the investee had net earnings which exceeded the dividends paid. The investor mistakenly recorded these transactions using the cost method instead of the equity method of accounting. What effect would this have on investment account, net earnings and retained earnings, respectively?

After the date of acquisition, the investment account using the equity method would

Under the equity method of accounting for investments, an investor recognizes its share of the earnings in the period in which the

When an investor uses the equity method to account for investment in ordinary shares, cash dividends received by the investor from the investee are recorded as

When an investor uses equity method to account for investment in ordinary shares, the investment account will be increased when the investor recognizes

How is goodwill arising on the acquisition of an associate dealt with in the financial statements?

The excess of the investor's share of the net fair value of the associate's net assets over the cost of the investment is

How is the impairment test carried our for an associate?

What is the accounting treatment when the financial statements of an associate are not prepared as of the same date as the financial statements of the investor?

The equity method is not applicable under all of the following circumstances, except

An investor shall discontinue the use of equity method when

When the investor discontinued the use of the equity method because significant influence is lost, the investment in associate retained by the investor shall be measure at

Goodwill arising from an investment in associate is

When an entity holds between 20% and 50% of the outstanding ordinary shares of an investee, which of the following statements is true?

If an associate has an outstanding cumulative preference share, held by outside interests, the investor computes its share of profits and losses

The contractual agreement between an investor and the bond issuer is contained in a formal document known as

Accrued interest on bonds purchased between interest dates

When an investor purchased a bond between interest dates at a premium, the cash paid to the seller is

The interest income for the year would be higher if the bond was purchased at

The interest income for the year would be lower if the bond was purchased at

Trading bond investments are reported at

Which of the following statements is correct in regard to trading bond investments?

Transaction cost directly related to acquisition of trading bond investments are

Trading bond investments are

A gain or loss on trading bond investment is the difference between

(3MINS).On October 1, 2015, Wall Company purchased 6,000 of the P 1,000 face amount , 10% bonds of Ayala Inc. for P 6,700,000 plus accrued interest of P 150,000. The bonds which mature on January 1, 2022, pay interest semiannually on January 1 and July. Wall uses the straight line method of amortization and appropriately recorded the bonds as financial asset at amortize cost. On December 31, 2016, the bond investment should be reported at what amount?

(3MINS). On July 1, 2015, Harry Corporation purchased as a long term investment in Finex Commpany's ten year 12% bonds with a face amount of P 5,000,000 for P 4,760,000. Interest is payable semiannually on January 1 and July 1. The bonds mature on July 1, 2019. Harry uses straight line method of amortization. What amount of interest income should be reported in the income statement for the year ended December 31, 2015?

(3MINS). On April 1, 2015, Sassy Company purchased P 2,000,000 face amount, 9% treasury notes for P 1,985,000, including accrued interest for P 45,000. The notes matures on July 1, 2016, and pay interest semi-annually on January 1 and July 1. The entity uses straight line method of amortization. What is the carrying amount of this investment on October 1, 2015?

(3MINS). Blue Company purchased 10% of Sky Company's 100,000 outstanding ordinary shares on January 1, 2019 for P 550,000. On December 31, 2019, Blue Company purchased an additional 20,000 shares of Sky for P 1,500,000. Sky Company had not issued any additional shares during 2019. The investee reported earnings of P 3,000,000 for 2019. The fair value of the 10% interest is P 900,000 on December 2019. What total amount of income should be recognized for 2019?

(3MINS). On January 1, 2016, Bubble Company acquired as a long term investment for P 7,000,000, q 40% interest in Rainbow Company when the fair value of Bubble's net assets was P 17,500,000. Rainbow Company reported the following net losses:

2016-5,000,000

2017-7,000,000

2018-8,000,000

2019-4000,000

On January 1, 2018, Bubble Company made a cash advances of P 2,000,000 to Rainbow Company. On December 31, 2019, it is not expected that Bubble Company will provide further financial support for Rainbow Company. What amount should be reported as a loss from investment for 2019?