____1. Other comprehensive income includes changes in equity

a. related to non-owner sourced transactions.

b. related to payment of dividends.

c. due to errors of other years.

d. due to unusual gains and losses of the current year.

____2. The cost model of accounting for PP&E assets

a. should be applied to investment property only.

b. should be applied to other PP&E assets only.

c. can be applied to all classes of PP&E including investment property.

d. is not appropriate under current Canadian GAAP.

____3. When an investor is using the equity method and the investee reports net income, the journal entry on the investors books will include a

a. debit to the Investment account.

b. credit to Retained Earnings.

c. credit to the Investment account.

d. debit to Investment Income or Loss.

____4. Under IFRS, which of the following is a condition for an investment to be classified as current?

a. It must be a cash equivalent.

b. It must be accounted for under the cost model.

c. It is held primarily for trading purposes.

d. It may be held for trading purposes, but could be held for long-term appreciation as well.

____5. Russia Inc. owns bonds that are accounted for under the fair value through net income model. On December 31, 2020, the bonds have a carrying value of $248,700. The fair value at that date is $245,000. The entry to record the year-end adjustment will include a debit to

a. FVNI Investments.

b. Investment Income or Loss.

c. ... Unrealized Holding Loss on FVOCI Investments.

d. Other Comprehensive Income.

____6. If Latvia Inc. acquired a 30% interest in Lithuania Ltd. on January 1, 2020 for $90,000, and during 2020 Lithuania reported net income of $50,000 and paid a total cash dividend of $20,000, applying the equity method would result in an increase (decrease) to Latvias Investment in Lithuania Ltd. account for 2020 of

a. $50,000.

b. $30,000.

c. $9,000.

d. $(20,000).