Explain the difference between short-term and long-term investment.

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Answer 1

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 A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

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Howard James started a business in 2011 in Jamaica and has been operating in the wholesale/retail industries, where he buys and sells household items to the local market. In 2012, he expanded his business operations and opened two other businesses in Trinidad and Tobago and Antigua and Barbuda, respectively. The annual sales of the respective businesses in 2015 are: Jamaica: J$3,000.00 Trinidad and Tobago: TT$251,000.00 Antigua and Barbuda: $299.00 Mr. James failed to register his business for VAT/GCT as specified by the respective Sales Tax Acts and Regulations. He stated that there is no need for his businesses to be registered because their sales are under the VAT thresholds and thus not required to be registered. a) You are to advise Mr. James if his decision not to register his businesses is justifiable. b) Search the respective VAT Acts for the 3 countries and advise Mr. James of the benefits of being a registered taxpayer; also the penalties for not registering for VAT/GCT.

Answer 2

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 A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

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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 A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

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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 A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

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Answer 5

Chapter A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

Answer 6

Chapter A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)

Answer 7

Chapter A, Problem 1Q

To determine

Explain the difference between short-term and long-term investment.

Answer 8

Expert Solution & Answer

Explanation of Solution

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Difference between short-term and long-term investments:

Short-Term Investments	Long-term Investments
The investments which are bought to sell or trade within a short time period of less than 90 days, are referred to as short-term investments.	The investments which are bought to hold for longer time period of more than 6 months are referred to as long-term investments.
These investments are reported as current assets on the balance sheet.	These investments are reported as non-current assets on the balance sheet.

Table (1)