Which of the Following Is Not Correct in Regard to Trading

question 56

Multiple Choice

Which of the following is not correct in regard to trading investments?

• A)They are held with the intention of selling them in a short period of time.
• B)Unrealized holding gains and losses are reported as part of net income.
• C)Any discount or premium is not amortized.
• D)All of these are correct.

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Definitions:

Double-Declining-Balance

A method of accelerated depreciation which doubles the regular depreciation amount.

Capitalize Development Costs

The accounting practice of adding the costs associated with developing a new product or service to the balance sheet as an asset, rather than expensing them.

Research Costs

Expenses related to the investigation and discovery of new knowledge that could be useful for the development of new products or services.

Units-Of-Production Method

A depreciation method that allocates an asset’s cost based on its usage, productivity, or units produced, rather than the passage of time.