(a) Introduction: Classification of Long term investments Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more. There are four primary categories of long term investments: Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds. Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future. Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company. Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company. To Prepare: Transactional data for acquisition of various types of long term securities

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Answer 1

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

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Problem No. 2 The trial balance of Cleint Lumanao Nacho Supplies on February 10, 2025, before accepting Shila Tajonera as partner is shown as follows: Account Title Debit Credit Ato Cash reening smuo P 100,000 Accounts Receivable 250,000 Allowance for Uncollectible Accounts P 20,000 o Merchandise Inventory Equipment Accumulated Depreciation Accounts Payable Notes Payable 120,000 275,000 55,000 50,000 82,000 538,000 Lumanao, Capital Total P 745,000 P 745,000 Tajonera offered to invest cash to get a capital credit equal to one-half of Lumanao's capital after giving effect to the adjustments below. Lumanao accepted the offer. Valuation of some of the assets and liabilities of Lumanao, as agreed by the partners, are the following: • The merchandise is to be valued at P93,000. The accounts receivable is estimated to be 90% collectible. • The equipment is to be valued at P200,000. The partners also agreed that the name of the partnership will be Nacho Business. Required: 1. In the books of…

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Answer 6

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

Answer 7

Chapter 15, Problem 4BTN

To determine

(a)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Transactional data for acquisition of various types of long term securities

Answer 8

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

Answer 9

To determine

(b)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Journal entries for acquisition of the long term investments.

Answer 10

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

Answer 11

To determine

(c)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Information needed to complete period end closing for the long term investments

Answer 12

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

Answer 13

To determine

(d)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

Journal Entries

Journal entries are the first step in recording financial transactions and preparation of financial statements.

These represent the impact of the financial transaction and demonstrate the effect on the accounts impacted in the form of debits and credits.

Assets and expenses have debit balances and Liabilities and Incomes have credit balances and according to the business transaction, the accounts are appropriately debited will be credited by credited to reflect the effect of business transactions and events.

To Prepare:

Year end closing entries for long term investments

Answer 14

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Answer 15

To determine

(e)

Introduction:

Classification of Long term investments

Long term investments are capital intensive purchases of financial assets such as shares and stocks, bonds and debentures, property, land etc. that the company acquires with intent to retain the investments for a period exceeding one year or more.

There are four primary categories of long term investments:

Held to Maturity Investments − They represent investments that the company intends to hold till the maturity of such instrument. It includes debt securities such as bonds.

Available for sale Investments − They represent investments that the company intends to hold for a period exceeding one year but with an intention to sell at the best available opportunity in the foreseeable future.

Significant Interest in Other companies − They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 25 % − 50 % of the outstanding equity shares of the other company.

Controlling Interest in Other companies - They represent investments made by a company in equity securities such as shares and stocks, of another company, usually in the range of 51 % or higher of the outstanding equity shares of the other company.

To Prepare:

Balance Sheet Section depicting long term investments

Answer 16

Expert Solution & Answer

Answer 17

Expert Solution & Answer

Answer 18

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Answer 19

Ch. 15 - Prob. 1QS Ch. 15 - Prob. 2QS Ch. 15 - Prob. 3QS Ch. 15 - Prob. 4QS Ch. 15 - QS 15-5 Reporting trading securities on financial...Ch. 15 - Prob. 6QS Ch. 15 - Prob. 7QS Ch. 15 - Prob. 8QS Ch. 15 - Prob. 9QS Ch. 15 - Prob. 10QS

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