Investment : The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment. Available-for-sale (AFS) securities : These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk. To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

Question

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Answer 1

Question

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

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Answer 2

Question

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

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Answer 3

Question

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

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Answer 4

Question

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

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Answer 5

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

Answer 6

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

Answer 7

Chapter 12, Problem 12.2DMP

1.

To determine

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

Available-for-sale (AFS) securities: These are short-term or long-term investments in debt and equity securities with an intention of holding the investment for some strategic purposes like meeting liquidity needs or manage interest risk.

To Locate: The annual report of a public company that includes the footnote describing the securities available for sale, using the EDGAR in the SEC website.

Answer 8

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

Answer 9

2.

To determine

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

Answer 10

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

Answer 11

3.

To determine

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

Answer 12

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

Answer 13

4.

To determine

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

Answer 14

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

Answer 15

5.

To determine

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

Answer 16

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

Answer 17

6.

To determine

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

Answer 18

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Answer 19

Expert Solution & Answer

Answer 20

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Answer 21

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

Solution Summary: The author explains the purpose of the Securities and Exchange Commission (SEC): to monitor the organizations and individuals and the various dealers involved in the securities market.

To Identify: The caption under which the securities are reported in the comparative balance sheets and to whether they are classified as current or non-current assets.

To Explain: The method of reporting the realized gains and losses, in the comparative income statement.

To Explain: The method of reporting the unrealized gains and losses, in the comparative statements and the shareholder’s equity.

To Explain: Under what head accumulated unrealized gains or losses identifiable in the comparative balance sheets. And the reason for not reporting them in the Income Statement.

To Explain: The information provided by the changes in the cash flow of these investments in the statement of cash flow.

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Chapter 12 Solutions