Short-Term Investments

question 49

Multiple Choice

Short-term investments:

• A) are reported after accounts receivable on the balance sheet.
• B) are more liquid than cash.
• C) are reported at historical cost on the balance sheet.
• D) include trading securities.

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Definitions:

Owner's Equity Statement Accounts

Reports detailing changes in the owner's equity account for a period, showing contributions, withdrawals, and the period's profit or loss.

Balance Sheet Accounts

Balance Sheet Accounts are the accounts that reflect the assets, liabilities, and equity of a company as recorded on the balance sheet, giving a snapshot of financial health at a specific point in time.

Current Assets

Liquid assets that a company owns and expects to use or convert into cash within a year or its operational cycle.

Cash

A company's currency or assets that can be immediately used for transactions or payments.