Question

GAAP allows companies that would normally use the equity method the option of using the fair...

  1. GAAP allows companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable.
  2. IFRS allows companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable.
  3. the concepts of significant influence and control under GAAP are very similar to the concepts used in IFRS.
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

GAAP allows the companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable -Answer :False

IFRS allows the companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable. - Answer : True

The concepts of significant influence and control under GAAP are very similar to the concepts used in IFRS.-

Answer : True

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
True and False: GAAP allows companies that would normally use the equity method the option of...
True and False: GAAP allows companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable. FRS allows companies that would normally use the equity method the option of using the fair value method, assuming the value of the stock is readily determinable. the concepts of significant influence and control under GAAP are very similar to the concepts used in IFRS. Journal entry 4.Big company receives...
According to GAAP, companies can elect the fair value option when accounting for many investments. Required:...
According to GAAP, companies can elect the fair value option when accounting for many investments. Required: Describe how accounting for a held-to-maturity investment, an available-for-sale investment, and an equity-method investment is affected by a company electing the fair value option.
Exercise 12-27 (Algo) Fair value option; equity method investments [LO12-6, 12-8] As a long-term investment at...
Exercise 12-27 (Algo) Fair value option; equity method investments [LO12-6, 12-8] As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 20% of Nursery Supplies Inc.’s 4 million shares of capital stock for $60 million. The fair value and book value of the shares were the same at that time. The company realizes that this investment typically would be accounted for under the equity method, but instead chooses to measure the investment at fair value....
IFRS U.S. GAAP 4. May use either cost model or revaluation model to a PPE class....
IFRS U.S. GAAP 4. May use either cost model or revaluation model to a PPE class. 4. Require cost model and prohibit revaluation model for PPE. 5. Each part of an item of PPE with a cost that is significant in relation to the total cost shall be depreciated separately 5. Take a ‘holistic view’ of PPE depreciation instead of the IFRS ‘component’ approach. Using the chart above: Discuss which accounting treatment (IFRS, U.S. GAAP, or another new treatment from...
1- Assuming a period of inflation, which inventory costing method will result in the highest profits?...
1- Assuming a period of inflation, which inventory costing method will result in the highest profits? Specific identification LIFO Average costs FIFO 2- An auditor's report that signifies that the financials of a company are fairly presented in accordance with GAAP accounting is called a _____________ report. qualified unqualified adverse disclaimer of opinion 3- Changes to prepaid expenses would be found on the: statement of shareholders' equity. cash flow statement. balance sheet. income statement. 4- 4- Non-GAAP accounting might be...
Financial Reporting and Analysis Assignment #1 Q1. What is IFRS? ? What is the IASB? ?...
Financial Reporting and Analysis Assignment #1 Q1. What is IFRS? ? What is the IASB? ? How widespread is the adoption of IFRS around the world? ? What is the possibility of the Securities and Exchange Commission substituting IFRS for GAAP? ? What are the advantages of converting to IFRS? ? What could be the disadvantages of converting to IFRS? ? What is the difference between convergence and adoption? ? When comparing IFRS and GAAP, what are some overall key...
On January 4, 2018, Runyan Bakery paid $324 million for 10 million shares of Lavery Labeling...
On January 4, 2018, Runyan Bakery paid $324 million for 10 million shares of Lavery Labeling Company common stock. The investment represents a 30% interest in the net assets of Lavery and gave Runyan the ability to exercise significant influence over Lavery's operations. Runyan chose the fair value option to account for this investment. Runyan received dividends of $2.00 per share on December 15, 2018, and Lavery reported net income of $160 million for the year ended December 31, 2018....
Accounting for Investments Using the Cost and Equity Methods On 1/1/x1, Omega Corporation’s net worth was...
Accounting for Investments Using the Cost and Equity Methods On 1/1/x1, Omega Corporation’s net worth was as follows: Common stock (15,000 shares, $10 par value)                                             $150,000 Additional paid-in capital                                                                             30,000 Retained Earnings                                                                                          60,000                 Total                                                                                                          $240,000            On 1/1/14, Alpha, Inc. purchased 3,000 shares of Omega Corporation at a price of $29 per share. Omega Corporation’s equity securities are not readily marketable. Alpha could not attribute any of the excess cost over book value to any...
Companies that use debt in their capital structure are said to be using financial leverage. Using...
Companies that use debt in their capital structure are said to be using financial leverage. Using leverage can increase shareholder returns, but leverage also increases the risk that shareholders bear. Consider the following case: 1.) Green Moose Industries is considering a project that will require $650,000 in total assets. The project will be financed with 100% equity, and the company incurs a tax rate of 30%. Assuming that Green Moose's project will earn a an EBIT of $140,000, the project...
Change to Equity Method On January 1, 2018, Lion Company paid $600,000 for 10,000 shares of...
Change to Equity Method On January 1, 2018, Lion Company paid $600,000 for 10,000 shares of Wolf Company's voting common stock, which was a 10% interest in Wolf. Lion does not have the ability to exercise significant influence over the operating and financial policies of Wolf. Lion received dividends of $1.00 per share from Wolf on October 2, 2018. Wolf reported net income of $400,000 for the year ended December 31, 2018, and the ending market price of its shares...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT