ACCOUNTING A416/ACG40 The company you work for has a large amount of disposable cash and very little debt on its books.
The company you work for has a large amount of disposable cash and very little debt on its books. The board of directors has expressed an interest in taking this money and investing in equity and debt securities of other companies. Please explain the characteristics of each type of security and how your company will need to record and value these on their books.I guessing that the types of securities that need to be explained are:Types of InvestmentsTrading Securities: These are investments in debt and equity securities that are purchased and then held mainly to sell in the near term.Available-for-Sale Securities: These are investments in debt securities that are not classified as held-to-maturity and further debt or equity securities that are not classified as trading securities.Held-to-Maturity Debt Securities: These investments are debt securities for which the company has the intent to hold until the maturity date.Then the second part would be to explain how they are recorded and valued on the company’s books.