ACC 522.docx

ACC 522- EXAM 1 TERMS & THINGS
QUESTIONS AND ANSWERS UPDATE
2026 WITH VERIFIED SOLUTIONS
100% CORRECT
what does "mark to market mean" - CORRECT ANSWES -- recognize at fair value

which debt status is amortized? - CORRECT ANSWES -- held to maturity

how is trading and available for sale debt securities recorded? - CORRECT ANSWES --
at fair value

AFS unrealized holding G/L as recorded as? - CORRECT ANSWES -- equity

Trading unrealized holding G/L are recorded as? - CORRECT ANSWES -- net income

debt securities represent? - CORRECT ANSWES -- an obligation

equity securities represent? - CORRECT ANSWES -- ownership

0-20% ownership - CORRECT ANSWES -- passive or little to none

20-50% ownership - CORRECT ANSWES -- significant influence, equity method

> 50% - CORRECT ANSWES -- complete control (majority voting rights)

journal entry for recording interest from debt - CORRECT ANSWES -- DR: interest
receivable
CR: interest revenue
CR: debt investment (HTM) or (AFS ) or (T)

journal entry for recognizing Future Value - CORRECT ANSWES -- DR: Future Value
adjustment (AFS) or (T)
CR: Unrealized holding G/L- equity

what must you do for a year 2 future value adjustment? - CORRECT ANSWES --
account for the change in FV using a t account

journal entry of a sale of stock: - CORRECT ANSWES -- DR: Cash
DR/CR: gain (loss) of investment
CR: Equity Investment