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Unformatted text preview: M351 Notes, Class 19, Investment in Debt Securities, pp. 837-850 Todays topics: What are the classifications for debt securities? For equity securities? For debt, well use the same table for investors that we set-up for issuers When do we book gains/losses for changes in market value? A. Debt securities (issued by other companies, or governmental entities; does not include A/R and loans receivable as those instruments do not meet the definition of securities) are to be placed in three portfolios: Hold to maturity company has the intent and ability to hold to maturity Trading securities to be sold in the near term; produce income or losses on short-term price differences Available for sale securities not in the hold to maturity or trading portfolios B. Accounting and reporting requirements for debt securities: Category Valuation Unrealized Holding Gains or Losses Other Income Effects Hold-to-maturity Amortized cost Not recognized Interest when earned gains and losses from sale Trading Fair value Recognized in net...
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This note was uploaded on 12/04/2009 for the course MGMT 351 taught by Professor Staff during the Spring '08 term at Purdue University-West Lafayette.
- Spring '08