Asked by JOSHUA MILLER on Jun 26, 2024
Verified
Long-term investments cannot include:
A) Held-to-maturity debt securities.
B) Securities with maturity dates within three months.
C) Equity securities giving an investor insignificant influence over an investee.
D) Equity securities giving an investor significant influence over an investee.
E) Available-for-sale debt securities.
Held-to-Maturity Debt Securities
Financial instruments that a firm intends and is able to hold until they mature, usually recorded at cost adjusted for amortization.
Equity Securities
Financial instruments that represent ownership interest in a company, such as stocks, granting holders a claim on part of the company's assets and earnings.
Insignificant Influence
Refers to a situation where an investor cannot exert significant control or influence over the investee company.
- Understand the classification and accounting for long-term investments.
Verified Answer
Learning Objectives
- Understand the classification and accounting for long-term investments.
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