Comprehensive income includes items not included in the computation of net income, such as foreign currency translation adjustments and unrealized gains and losses on available-for-sale securities. True False

Comprehensive income includes items not included in the computation of net income, such as foreign currency translation adjustments and unrealized gains and losses on available-for-sale securities. True False

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter13: Marketable Securities And Derivatives

Section: Chapter Questions

Problem 3Q

See similar textbooks

Related questions

Q: Which of the following statements is correct regarding reporting of “Extraordinary gains and losses”…

A: The extraordinary gains and losses are the gains and losses that do not gain or incurred in the…

Q: Statement 1: The components of other comprehensive income include changes in revaluation surplus.…

A: Lets understand basic thing about the other comprehensive income. Other comprehensive income is a…

Q: True/False Companies do not report changes in the fair value of available-for-sale debt securities…

A: Available for sale securities are securities which are held with the intention of selling them…

Q: How are gains and losses on financial instruments used to hedge the net investment in a foreign…

A: Financial instruments are either tradable assets or can alternatively be thought of as bundles of…

Q: What are the differences in accounting for a forward contract used as a fair value hedge of (a) a…

A: Forward contract: Forward contract is the contract entered by two private parties to buy or sell a…

Q: When comparing fi nancial statements prepared under IFRS with those prepared underUS GAAP, analysts…

A: IFRS and US GAAP follows similar accounting policies when it comes to realized losses and unrealized…

Q: Investments in equity securities for which the investor has insignificant influence over the…

A: Fair value: Fair value is the price at which, both seller and buyer agree to exchange the asset. So,…

Q: Which of the following costs may not be eligible for capitalization as borrowing costs under PAS 23?…

A: The costs that an entity incurs with regard to the funds borrowed are referred to as the borrowing…

Q: Match each of the items below with its most appropriately-related “letter” classification. (“Letter”…

A: Since the question has more than 3 sub-parts, the first 12 subparts are answered. If you want the…

Q: Reporting an investment at its fair value means adjusting its carrying amount for changes in fair…

A: Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and…

Q: hich of the following is not one of the components of other comprehensive income? a. changes in…

A: Which of the following is not one of the components of other comprehensive income? a. changes…

Q: Which of the following is NOT a component of Accumulated Other Comprehensive Income? A. Gains or…

A: Other comprehensive income (OCI) includes any unrealized gains or losses from sources of funds from…

Q: 6. Which of the following is not considered an appropriate application of offsetting under PAS 1?…

A: Offsetting-: Offsetting, otherwise also named netting, carries place when entities propose their…

Q: what is the difference between marketable equity securities held as financial asset at fair value…

A: Financial assets are the intangible assets, which are used as investment asset by the investors.…

Q: The unrealized gain/loss from investment valuation for trading securities and available-for-sale…

A: Valuation of Securities: A security valuation is a method that is used by regulators to analyze the…

Q: A US Company can choose to report its financial statements using GAAP or IFRS Group of answer…

A: GAAP is the generally accepted accounting principles which are the set of rules and regulations, and…

Q: Marketable securities are accounted for at their current fair value using mark-to-market accounting.…

A: Mark-to-Market accounting is an accounting practice that helps to adjust the value of an asset on…

Q: Unrealized holding gain/loss which are taken to profit or loss are from securities that are…

A: Answer:- Unrealized gain meaning:- A notional profit that exists on paper as a consequence of an…

Q: Which of the following is correct regarding the classification of investment in debt instruments as…

A: Option (c) is correct answer.

Q: Which of the following is not a characteristic of a financial asset held for trading? a. It is…

A: Trading in financial instrument include assets such as stocks bonds mutual fund. the financial asset…

Q: At each reporting date, companies adjust debt investments which fails in cash flows test to fair…

A: The question is related to the IFRS 9 Financial Instruments.

Q: Equity Investment classified at Fair Through Profit or loss (choose which of the following is false)…

A: Solution: Security held for trading classified at fair value through profit or loss and equity…

Q: Assets and liabilities, and income and expenses, when material, shall not be offset against each…

A: As per general accounting principal, liabilities & assets and income & expenses should not…

Q: Which of the following is not correct in regard to trading securities a. they are held with the…

A: Answer - Option a. they are held with the intention of selling them in a short period of time -…

Q: Which of the following statements is true for the translation process using the current rate…

A: Current rate method of translation: The concept underling the current rated method is liabilities…

Q: Explain the ‘qualifying asset’ and how do we treat exchange rate differences relating to the…

A: A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for…

Q: true or false ___________ if the fair value of the asset given u[ in exchange transaction that has…

A: Fair market value: It is the value of the fixed asset on which a particular asset is being sold in…

Q: 1. Investments in debt securities are classified for accounting purposes as: A. Financial asset at…

A: Debt investments and equity investments recorded using the cost method are classified as trading…

Q: Which of the following is correct regarding the classification of investment in debt instruments as…

A: Option (b) is correct. Explanation is given in next step.

Q: 4. Which of the following is not a component of other comprehensive income? a. Unrealized gain on…

A: ‘’Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: When holding available-for-sale securities, a company should disclose for each income statement…

A: It is investment in debt or equity but it intent to sale before its maturity.

Q: 2. Which of the following is not included in comprehensive income? a. gains on reissuance of…

A: Comprehensive income: It includes all the changes in company's equity during a specified period…

Q: An investment in another country's stocks or bonds that does not take direct control of the related…

A: Stocks are a type of securities that give shareholders proportionate ownership in the company.…

Q: Is unrealized loss deducted in marketable equity securities held as financial asset at fair value…

A: Yes ,unrealized loss reported as component of other comprehensive income and marketable equity…

Q: (Based on Appendix 12B) Reporting an investment at its fair value requires adjusting its carrying…

A: Available for sale securities: These are the securities which are not intended to be sold in the…

Q: In your own words, briefly explain a 'qualifying asset' and how we report exchange rate differences…

A: The question is related to Borrowing Cost. As per Borrowing Cost there are two types of Assets 1.…

Q: Which one of the following is part of other comprehensive income (OCI)? Multiple Choice Sale of…

A: other comprehensive income (OCI) means those income , expenses , gains and losses which are yet to…

Q: In investment in debt securities accounted for at fair value through other comprehensive income, the…

A: The income statement includes revenues and expenses for the company.

Q: Transfers of investments between categories a. Should always affect net income b. Are accounted…

A: Transfer of an Investment:- It is a procedure where one company or entity sells its investment to…

Q: Reporting an investment at its fair value means adjusting its carrying amount for changes in fair…

Q: Assets and liabilities, and income and expenses, when material, shall not be offset against each…

A: Foreign exchange gains and losses are permissible to be offset against each other. An entity may…

Q: Any unrealized gains or losses are reported in the regular income statement for a) Trading…

A: Introduction:- The accounting treatment is based on the type of securities. These are are classified…

Question

Comprehensive income includes items not included in the computation of net income, such as foreign currency translation adjustments and unrealized gains and losses on available-for-sale securities.

True

False

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

When preparing an income statement, which of the following items would most likely be classified as other comprehensive income? A. A foreign currency translation adjustment B. An unrealized gain on a security held for trading purposes C. A realized gain on a derivative contract not accounted for as a hedge D. None of the above
Which of the following is NOT a component of Accumulated Other Comprehensive Income? A. Gains or losses on Treasury Stock B. Unrealized holding gains or losses on available-for-sale securities C. Gains or losses from foreign currency translation adjustments D. Gains or losses related to post retirement benefit plans (pensions)
Describe the following 1. Unrealized gains or losses on derivatives held on cash flow hedges. 2.Unrealized gains or losses on investment available for sale. 3.Dividends declared in a particular period. 4.Gain or losses on foreign exchange translations. 5.Recording of previous periods errors in revenue and expenditure after preparation of final accounts in the current periods.
How should exchange gains or losses resulting from foreign currency transactions be accounted for? Included as component of income from continuing operations for the period in which the rate changes. Included as component of other comprehensive income for the period in which the rate changes. Included in the statement of financial position as a deferred item. Included in net earnings for gains, but deferred for losses.
accrued income such as dividend receivable are normally classified asa. noncurrent trade receivablesb. current nontrade receivablesc. noncurrent non-trade receivablesd. Trade receivables
Is unrealized loss deducted in marketable equity securities held as financial asset at fair value through other comprehensive income?
Which of the following items is NOT classified as a financial asset? a. promissory notes b. forward exchange contracts c. inventory d. accounts receivable
What causes balance sheet (or translation) exposure to foreign exchange risk? How does balance sheet exposure compare with transaction exposure?
Which of the following costs may not be eligible for capitalization as borrowing costs under PAS 23? * Interest on bonds issued to finance the construction of a qualifying asset. Exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to interest costs pertaining to a qualifying asset. Amortization of discounts or premiums relating to borrowings that qualify for capitalization. Imputed cost of equity.
Which statement is correct regarding fair value hedges and cash flow hedges of a foreign currency asset or liability. a. revaluation of a cash flow hedge is reported in the income statement b. under a cash flow hedge the difference between the revaluation gain and loss on the hedge and the revaluation gain or loss on the item being hedged is reported in Other Comprehensive Income c. under a cash flow hedge the difference between the revaluation gain or loss on the hedge and the revaluation gain or loss on the item being hedged is reported in the income statement d. a. revaluation of a fair value hedge is reported in Other Comprehensive Income e. under a fair value hedge the difference between the revaluation gain or loss on the hedge and the revaluation gain or loss on the item being hedged is reported in Other Comprehensive Income
Choose the correct. Which of the following operating segment disclosures is not required under current U.S. accounting guidelines?a. Liabilitiesb. Interest expensec. Intersegment salesd. Unusual items
impairments on financial instruments are ? A) recognized as a realized loss if the impairment is judged to be temporary B) based on discounted cash flows for securities C) based on fair value for available-for-sale investments and negotiated values for hel-to-maturity investments D) evaluated using the CECL model similiar to receivables