Asked by Islam Soliman on May 22, 2024
Verified
Which one of the following would not be classified as a short-term investment?
A) Marketable stock securities
B) Equity method investments
C) Marketable debt securities
D) Short-term paper
Equity Method Investments
Investments in which the investor has significant influence over, but not full control or ownership of, another company, requiring recognition of its share of the investee's profits or losses.
Marketable Stock Securities
Financial instruments that represent ownership in companies or rights to ownership, easily bought and sold in public markets.
Short-Term Investment
A short-term investment is an asset that is expected to be converted into cash or sold within a short period, typically one year, to generate income.
- Pinpoint and classify distinct categories of investments that a firm can hold.
Verified Answer
KC
Keeziah Charise FloresMay 24, 2024
Final Answer :
B
Explanation :
Equity method investments are generally considered long-term investments because they involve significant influence and control over the investee's operations and financial decisions. Marketable stock securities, marketable debt securities, and short-term paper are all examples of short-term investments.
Learning Objectives
- Pinpoint and classify distinct categories of investments that a firm can hold.