E17-1 - D Bonds that will mature in 5 years are purchased....

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E17-1 (LO 1 , 3 ) (Investment Classifications) For the following investments identify whether they are: 1 Trading secrets 2 Available-for-Sale securities 3 Held-to-Maturity Securities Each case is independent of the other. A A bond that will mature in 4 years was bought 1 month ago when the price dropped. As soon as the value increases, which is expected next month, it will be sold. B 10% of the outstanding stock of Farm-Co was purchased. The company is planning on eventually getting a total of 30% of its outstanding stock. C 10-year bonds were purchased this year. The bonds mature at the first of next year.
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Unformatted text preview: D Bonds that will mature in 5 years are purchased. The company would like to hold them until they mature, but money has been tight recently and they may need to be sold. E Preferred stock was purchased for its constant dividend. The company is planning to hold the preferred stock for a long time. F A bond that matures in 10 years was purchased. The company is investing money set aside for an expansion project planned 10 years from now. SOLUTIONS A 1 B 2 C 1 D 2 E 2 F 3...
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E17-1 - D Bonds that will mature in 5 years are purchased....

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