ACCT 3021 Chapter : Chapter 17 Class Notes
Document Summary
Have the following characteristics: a maturity value, an interest rate, a maturity date. 15) represent ownership in a company: right to collect dividends, right to vote on corporate matters (cs, potential for significant returns, potential for influence. 1: investments in debt securities, held-to-maturity debt securities only. Positive intent to hold until maturity and ability to hold until maturity: trading securities intend to sell in near future, generally 3 months or less, available-for sale securities catch all category. Different accounting treatment depending on management"s intent to hold or sell securities. Summary chart see page 953, illustration 17-2. Amortized cost (cv) cost adjusted for amort of prem/disc. Jones company purchased ,000 of 8% bonds of. The bonds mature on january 1, 2018, and pay interest each january 1 and. The market rate of interest at the time of purchase was 10%. Assume at december 31, 2013, the fair value of the bonds is ,000.
