All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Question

Want to see more full solutions like this?

Answer 1

Textbook Question

Chapter 12, Problem 12.1Q

All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

On a balance sheet, what valuation must be reported for debt securities classified as available-for-sale?

Where are debt investments classed as trading securities, available-for-sale securities, and held-to-maturity securities recorded on the asset side of the balance sheet? Explain

Define the term debt securities.

Answer 2

Textbook Question

Chapter 12, Problem 12.1Q

All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Textbook Question

Chapter 12, Problem 12.1Q

All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Textbook Question

Chapter 12, Problem 12.1Q

All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Textbook Question

Answer 6

Textbook Question

Answer 7

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Answer 8

Expert Solution & Answer

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

To determine

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

To indicate: The three categories in which investments in debt securities are classified

Answer 12

Explanation of Solution

For, the purposes of reporting, the investments in debt securities are classified in the following three categories:

Held-to-maturity securities
Trading securities
Available-for-sale securities

Answer 13

Conclusion

Thus, for the purposes of reporting, the investments in debt securities are classified into held-to-maturity, trading, and available-for-sale securities.

Answer 14

Ch. 12 - All investments in debt securities are classified...Ch. 12 - When market rates of interest rise after a...Ch. 12 - Does GAAP distinguish between fair values that are...Ch. 12 - When a debt investment is acquired to be held for...Ch. 12 - Prob. 12.5Q Ch. 12 - What is comprehensive income? Its composition...Ch. 12 - Why are holding gains and losses treated...Ch. 12 - Prob. 12.8Q Ch. 12 - Prob. 12.9Q Ch. 12 - Prob. 12.10Q

All investments in debt securities are classified for reporting purposes in one of three categories, and can be accounted for differently depending on the classification. What are these three categories?

Concept explainers

Videos

Explanation of Solution

Want to see more full solutions like this?

Chapter 12 Solutions