Short-term investments: Investments which are made for a period of less than 12 months are called short-term investments. Current assets: Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables. Two conditions under which an investment should be classified as current assets.

Question

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Answer 1

Question

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

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Students have asked these similar questions

An asset owned by Crescent Manufacturing has a book value of $36,000 on June 30, Year 5. The asset has been depreciated at an annual rate of $8,000 using the straight-line method. Assuming the asset is sold on June 30, Year 5 for $39,500, how should the company record the transaction? a. Neither a gain nor a loss is recognized on this type of transaction. b. A gain on sale of $3,500. c. A gain on sale of $5,000. d. A loss on sale of $3,500. e. A loss on sale of $5,000.

Can you solve this financial accounting question with the appropriate financial analysis techniques?

Can you solve this general accounting question with the appropriate accounting analysis techniques?

Answer 2

Question

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

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Answer 3

Question

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

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Answer 4

Question

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

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Answer 5

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

Answer 6

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

Answer 7

Chapter 15, Problem 1DQ

To determine

Introduction:

Short-term investments:
Investments which are made for a period of less than 12 months are called short-term investments.

Current assets:
Current assets are assets which are either cash or realizable in cash in short-term period. Current assets include cash, cash equivalents, short-term investments, accounts receivables.

Two conditions under which an investment should be classified as current assets.

Answer 8

Expert Solution & Answer

Answer to Problem 1DQ

Solution:

To classify an investment as a current asset, it should be a short-term investment and should be easily convertible into cash.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Explanation of Solution

An investment can be classified as a current asset if it satisfies the following two conditions:

It should be a short-term investment (investment for a period of 12 months or less)
It should be easily convertible into cash.

Answer 12

Conclusion

Hence, it can be concluded that a short-term investment which is easily convertible into cash, can be classified as Current assets

Answer 13

Ch. 15 - Prob. 1DQ Ch. 15 - Prob. 2DQ Ch. 15 - Prob. 3DQ Ch. 15 - Prob. 4DQ Ch. 15 - Prob. 5DQ Ch. 15 - Prob. 6DQ Ch. 15 - Prob. 7DQ Ch. 15 - Prob. 8DQ Ch. 15 - Prob. 9DQ Ch. 15 - Prob. 10DQ

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Answer to Problem 1DQ

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