Asked by
Calvin Harvey
on Dec 16, 2024
Verified
Which of the following is false?
A) The cost model is used only for equity investments.
B) The cost model reports realized gains and losses on the statement of income.
C) The cost model is used to account for equity investments where there is significant influence.
D) The cost model is very similar to the amortized cost model.
Cost Model
A method of accounting where assets are carried at their cost minus any accumulated depreciation and impairment losses.
Realized Gains
Profits earned from the sale of an asset, which exceed the asset's purchase price, recognized in the company's financial statements.
- Distinguish between different models used for valuing non-strategic investments.
Verified Answer
DG
Learning Objectives
- Distinguish between different models used for valuing non-strategic investments.