1-If the Fair Value Adjustment minus Trading account for trading debt investments has a debit balance, it is ________.

2-A preferred stock is an example of a debt security.

• True
• False

3-Equity securities, in which the investor lacks the ability to participate in the decisions of the investeecompany, are initially accounted for at the lower-of-cost-or-market value.

• True
• False

4-when a trading debt security is disposed of, the amount of gain or loss is calculated as the difference between the cash received and the cost of the debt security disposed of.

True

False

5-gain on disposal of equity investments is a temporary equity account and is reported in the other income and (expenses) section of the income statement.

True

False