When a company invests in another corporation up to 20% of total outstanding shares, it is assumed that the investor company does not possess an important role in determination of company policies. In other words, this investment does not represent a managerial role in invested company. In this case, depending on the intention of management, the security can be reported either as tradingsecurity or available for sale security. The correct answer is E.

The correct answer is question E. Cash is an asset account, not a current liabilities.

The process of allocating the cost of an intangible asset to expense over its useful life is referred to amortization.

Customers may make advanced payments for the goods or services they will receive in the future. When the company receives an advanced payment, an obligation occurs for delivering the goods or rendering the service for which the customer has made payment. Therefore, company must record a liability in its financial statements and this liability is named unearned revenue. In this context, unearned revenues can be defined as the payments received in advance for the products or services being provided. Unearned revenue should be converted into earned revenue as consistent with the matching principle. The correct answer is E.

A security that offers an interest rate, which is higher than the market return, is sold at premium; whereas lower-than-market interest rate requires a discounted price for the security to be sold. The correct answer is C.

Liability is defined as the present obligation of a company arising from past events and fulfillment of which causes the outflow of economic benefits in terms of payments of cash, transfer of assets or rendering of services.The correct answer is A.

The investor company is called parent and the investee is subsidiary. The correct answer is B.

The cost of the vehicles include the purchase price and other necessary expenditures made to bring them to their intended uses. If the expenditure made for vehicles extends the useful life of the vehicle and/ or increases the capacity, like modification or engine renewal, then these expenditures will be capitalized. But the regular maintenance expenditures such as oil change or minor engine repairs will be recorded as period expenses. As can also be understood from the information given, the correct answer is C. Expenditures made for oil change and minor engine repairs will be recorded as period expenses. Expenditures made for modification and engine renewal extend the useful life of the vehicle and/ or increase the capacity, then these expenditures will be capitalized.

Trademarks are assets that represent distinctive identifications of products or services.

Double- Declining Balance Depreciation = (Cost - Accumulated Depreciation)x 2/ Useful Life

=(280.000 +20.000 - 0)  x 2/5= 120.000 for the year 2018

= (300.000 - 120.000) x 2/5 = 72.000 for the year 2019

The correct answer is D. Debts of more than one year are long-term liabilities.

The cost of the land includes the following items; – purchase price – brokerage commission – survey and legal fees – property taxes in arrears – taxes assessed to transfer the ownership on the land – cost of clearing the land and removing unwanted buildings.

The correct answer is A. In journal entry cash is debitted 500.000 TL , bank loans are credited as 500.000 TL.

Property, plant and equipment assets have the following major characteristics:  They are acquired for use in operations and not for resale: Because those assets are acquired for use in operations for several years, they are recognized under non-current assets. 

They are in long-term in nature and usually depreciated: Property, plant and equipment assets provide economic benefit for several years. This means that within the revenue the company earned these assets have contributions.

They possess physical substance: Property, plant and equipment have physical existences. They are also called tangible assets because of this characteristic.

The correct answer is D.

The leasehold improvements account is capitalized because the expenditure made is for the rented estate to bring it to its intended use and also it increases the value of the estate.

First of all, for an economic resource to be recognized as an asset, it must have a capacity of providing future benefit. Secondly, it must be controlled by the business and lastly the transaction that caused future benefit and control must occur in the past. The control property here indicates that an economic resource must be fully under control of a business but other parties don’t have a right of providing benefit from it. When the business rents a building to use in the operations, it cannot be recognized as an asset because the business doesn’t have full control on building. The correct answer is B.

Intangible assets have distinctive qualifications from other assets that require them to be recorded as intangible asset. These are;

• They have a value for a specific company
• Some of them have unlimited life
• Their values fluctuate highly because their benefits are based on competition.

 It was recorded as a period expense. The correct answer is A.

(35.000-8.000)X2=10.800

35.000-10.800=24.200

If the price paid for security is equal to the face value, then the security is told to be sold at par. However, the purchase price generally differs from face value. If the security is sold at a price below the face value, it is sold at a discount. On the other hand, if the price exceeds the face value, security is sold at a premium7 . What determines whether it will be sold at par, at discount or at premium is usually the difference between the interest rate offered by security and the rate of return available in the market. The correct answer is C.