苏州市离休生活待遇一览表.pptx

Receivables and Short-TermInvestments Learning Objective 1Understand short-terminvestments. Short-Term InvestmentsShort-term investments are investments thata company plans to hold for one year or less.– Held-to-maturity securities– Trading investments– Available-for-sale investmentsHeld-to-maturity and available-for-salesecurities could also be long-term. Short-Term InvestmentsHeld-to-maturity investments aresecurities that the investor expectsto hold until their maturity date.They earn interest revenue for the investor.Accounting for these securities is thesame as accounting for notes receivable. Short-Term InvestmentsTrading InvestmentsSuppose that Oracle Corporation purchasesFord Motor Company stock on May 18,paying $100,000, with the intention ofselling the stock within a few months. Short-Term InvestmentsMay 18Short-Term Investment 100,000 Cash 100,000Purchased investmentOn May 27, Oracle receives a cashdividend of $4,000 from Ford. Short-Term InvestmentsMay 27Cash 4,000 Dividend Revenue 4,000Received cash dividendOracle fiscal year ends on May 31, andthe investment in Ford has a currentmarket value of $102,000 on this date. Short-Term InvestmentsMay 31Short-Term Investment 2,000 Unrealized Gain on Investments 2,000Adjusted investment to market valueShort-Term InvestmentsCost 100,000Adjustment to market value 2,000Balance 102,000 Reporting on the Balance Sheetand the Income StatementBalance SheetCurrent Assets: $ XXX Cash XXX Short-term investments at market value 102,000 Accounts receivable XXXIncome StatementRevenues $ XXXExpenses XXXOther revenues, gains, and (losses): Interest revenue XXX Dividend revenue 4,000 Unrealized gain on investment 2,000 Accounts and Notes ReceivableReceivables are the third most liquid asset – after cash and short-term investm