1. A company invests in a 5-year debt security at a discount. The security is classified as HTM. Using the effective interest method, the company will report interest revenue on this security that is:

	A.	Decreasing over the years
	B.	Decreasing in the first and second year and increasing in the remaining years
	C.	Equal each year
	D.	Increasing over the years

2. On January 1, 2019, Ola Company paid $388,900 for a $400,000 face value 3% corporate bond yielding 4%, interest paid annually on December 31, and classified it as held-to-maturity. Ola's reporting year ends December 31. On its 2020 balance sheet, Ola reports the investment at:

	A.	$397,296
	B.	$395,981
	C.	$398,231
	D.	$396,154

3. Which statement is true concerning the reporting for equity investments with no significant influence?

	A.	They are reported at cost, with unrealized changes in value reported in OCI.
	B.	They are reported at fair value, with unrealized changes in value reported in OCI.
	C.	They are reported at fair value, with any changes in value reported in income.
	D.	They are categorized as either trading or available-for-sale, with unrealized changes in the value of trading securities reported in income, and unrealized changes in the value of AFS securities reported in OCI.

4.

1. A company holds a $100,000 face value corporate bond, bought January 1, 2019, paying 3% annually on December 31, and maturing December 31, 2021. The company paid $102,884 for the bond, to yield 2%. The company categorizes the bond as a held-to-maturity investment, and its accounting year ends December 31. Round answers to the nearest dollar. Assume the market value of the bond on December 31, 2019 is $70,000, and no previous impairment has been reported. The decline in value is due to credit losses. What impairment loss is reported on the company's 2019 income statement?

   	A.	$32,884
   	B.	$31,942
   	C.	$30,000
   	D.	$27,000