Practice Question 19 A company made an investment in ABC Bonds for the purpose of earning interest. The bonds have an amortized cost of $11,300 and are being sold before maturity for $11,900. The journal entry for the sale will include O a credit to Gain on Sale of ABC Bonds for $600. O a credit to ABC Bonds for $11,900. O a debit to Loss on Sale of ABC Bonds for $600. O a debit to Cash for $11,300. Practice Question 23 Favaro Company purchased 25% of the outstanding common shares (10,000 shares) of ABC Company for $65,000 on August 1. At December 31, Favaro's year end, ABC's shares are selling for $7 and ABC reported net income of $160,000. Assuming Favaro accounts for the investment using the equity method, the adjustment to the investment account at year end would be O Debit to Investment in Associate - ABC Company for $17,500. O Debit to Investment in Associate - ABC Company for $40,000. O Debit to Investment in Associate - ABC Company for $160,000. O Debit to Investment in Associate - ABC Company for $5,000. Testbank Question 59 Short- or long-term debt instruments held for trading are recorded as O current asset at fair value. O non-current assets at fair value. O current assets at amortized cost. O non-current assets at amortized cost. Testbank Question 74 Which of the following is a true statement about the accounting for investments held for trading under IFRS? Gains and losses are recorded in OCI when the market value is different from the purchase price. O The accounting for trading investments is the same as the accounting for short-term investments in debt instruments purchased to earn interest. O The investment is initially recorded at face value. O The investment is initially recorded at fair value. Testbank Question 86 Which of the following investments would most likely NOT be valued at fair value on a company's books? debt investment purchased to trade by companies reporting under IFRS in the short- term at gain investments held for trading strategic investments held by companies reporting under IFRS with less than 20% ownership strategic investments held by companies reporting under IFRS with more than 20% ownership