True or False A debt security acquired as an investment cannot be classified as a trading...
True or False
A debt security acquired as an investment cannot be classified as a trading security.
Homework Answers
Answer : False
A Debt Security can be Classified as the trading security or Long term investment.
an Investment made on debt or Equity for the Purpose of Selling them in a very short run period is Classified as the Trading Securities and Shown as the Curent Assets in Balance Sheet. Where as the Purpose is long term holding than the investment considered as the Lonr -term invesment
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True or False
A debt security acquired as an investment cannot be classified
as a trading...
1-If the Fair Value Adjustment minus trading account for trading debt investments has a debit balance,...
1-If the Fair Value Adjustment minus trading account for trading debt investments has a debit balance, it a. Added to the trading debt investment account to determine carrying value b. Considered to be a contra account C. Subtracted from the trading debt investment account to determine carrying value d. Reported in the other income and expenses section of the income statement. 2-when a trading debt security is disposed of, the amount of gain or loss is calculated as the difference...
1-If the Fair Value Adjustment minus Trading account for trading debt investments has a debit balance,...
1-If the Fair Value Adjustment minus Trading account for trading debt investments has a debit balance, it is 2-A preferred stock is an example of a debt security. • True False 3-Equity securities, in which the investor lacks the ability to participate in the decisions of the investee company, are initially accounted for at the lower-of-cost-or-market value. True . False 4- are equity securities in which the investor owns between 20% and 50% of the investee's voting stock. 5-Securities are...
A simple investment is never classified as a pure investment. However, a mixed investment will always...
A simple investment is never classified as a pure investment. However, a mixed investment will always be classified as a simple investment. True or False? True False
Caldwell Company acquired $3,517,000 face value, 10% bonds as a trading debt investment on January 1...
Caldwell Company acquired $3,517,000 face value, 10% bonds as a trading debt investment on January 1 of the current year when the market rate of interest was 12%. Interest is paid annually each December 31. Caldwell purchased the bonds, which mature in 12 years, for $3,081,288. Caldwell amortizes the discount using the effective interest rate method. The fair value of the bonds at the end of the year is $3,012,000. Prepare the journal entries required on the date of acquisition...
The risk that a security cannot be sold at a predictable price with low transaction costs...
The risk that a security cannot be sold at a predictable price with low transaction costs at short notice is called liquidity is True or False True False Book
The risk that a security cannot be sold at a predictable price with low transaction costs...
The risk that a security cannot be sold at a predictable price with low transaction costs at short notice is called liquidity risk! True or False True False
Exercise 15-2 Accounting for debt investments classified as trading LO P1 Brooks Co. purchases debt investments...
Exercise 15-2 Accounting for debt investments classified as trading LO P1 Brooks Co. purchases debt investments as trading securities at a cost of $54,000 on December 27. This is its first and only purchase of such securities. At December 31, these securities had a fair value of $69,000. 1. Prepare the December 27 entry for the purchase of debt investments. 2. & 3. Prepare the December 31 year-end fair value adjusting entry for the trading securities' portfolio and the January...
Need help in analysis the below Debt Investment paragraph. DEBT INVESTMENTS We consider all highly liquid...
Need help in analysis the below Debt Investment paragraph. DEBT INVESTMENTS We consider all highly liquid debt investments with original maturities from the date of purchase of three months or less as cash equivalents. Cash equivalents can include investments such as corporate debt, financial institution instruments, government debt,and reverse repurchase agreements.Marketable debt investments are generally designated as trading assets when a market risk is economically hedged at inception with a related derivative instrument, or when the marketable debt investment itself...
True or False: Ordinary table salt is classified as a molecular solid.
True or False: Ordinary table salt is classified as a molecular solid.
The Andean Community’s largest trading partner is the U.S. A. True B. False Subsidies are nontariff...
The Andean Community’s largest trading partner is the U.S. A. True B. False Subsidies are nontariff barriers. A. True B. False NAFTA is an example of an economic union. A. True. B. False
1-If the Fair Value Adjustment minus trading account for trading debt investments has a debit balance, it a. Added to the trading debt investment account to determine carrying value b. Considered to be a contra account C. Subtracted from the trading debt investment account to determine carrying value d. Reported in the other income and expenses section of the income statement. 2-when a trading debt security is disposed of, the amount of gain or loss is calculated as the difference...
1-If the Fair Value Adjustment minus Trading account for trading debt investments has a debit balance, it is 2-A preferred stock is an example of a debt security. • True False 3-Equity securities, in which the investor lacks the ability to participate in the decisions of the investee company, are initially accounted for at the lower-of-cost-or-market value. True . False 4- are equity securities in which the investor owns between 20% and 50% of the investee's voting stock. 5-Securities are...
A simple investment is never classified as a pure investment. However, a mixed investment will always be classified as a simple investment. True or False? True False
Caldwell Company acquired $3,517,000 face value, 10% bonds as a trading debt investment on January 1 of the current year when the market rate of interest was 12%. Interest is paid annually each December 31. Caldwell purchased the bonds, which mature in 12 years, for $3,081,288. Caldwell amortizes the discount using the effective interest rate method. The fair value of the bonds at the end of the year is $3,012,000. Prepare the journal entries required on the date of acquisition...
The risk that a security cannot be sold at a predictable price with low transaction costs at short notice is called liquidity is True or False True False Book
The risk that a security cannot be sold at a predictable price with low transaction costs at short notice is called liquidity risk! True or False True False
Exercise 15-2 Accounting for debt investments classified as trading LO P1 Brooks Co. purchases debt investments as trading securities at a cost of $54,000 on December 27. This is its first and only purchase of such securities. At December 31, these securities had a fair value of $69,000. 1. Prepare the December 27 entry for the purchase of debt investments. 2. & 3. Prepare the December 31 year-end fair value adjusting entry for the trading securities' portfolio and the January...
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