BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

FINANCIAL ACCOUNTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Marketable securities bought and held primarily for salein the near term are classified as:
A
available-for-sale securities.
B
held-to-maturity securities.
C
stock securities.
D
trading securities
Explanation: 

Detailed explanation-1: -Marketable securities are defined as any unrestricted financial instrument that can be bought or sold on a public stock exchange or a public bond exchange. Therefore, marketable securities are classified as either marketable equity security or marketable debt security.

Detailed explanation-2: -Marketable securities are investments that can easily be bought, sold, or traded on public exchanges. The high liquidity of marketable securities makes them very popular among individual and institutional investors. These types of investments can be debt securities or equity securities.

Detailed explanation-3: -Short-term investments, also known as marketable securities or temporary investments, are financial investments that can easily be converted to cash, typically within five years. Many short-term investments are sold or converted to cash after a period of only three-12 months.

Detailed explanation-4: -An available-for-sale security (AFS) is a debt or equity security purchased with the intent of selling before it reaches maturity or holding it for a long period should it not have a maturity date.

There is 1 question to complete.