Practicing Success
If debentures, purchased in open market, are not immediately cancelled, they are treated as which of the following? |
Current Assets Current Liabilities Investment Capital |
Investment |
Debentures purchased on the open market are indeed recognized as investments on a company's balance sheet if they are not immediately canceled. When a company buys debentures as part of its investment portfolio, these debentures are treated as financial assets and are typically categorized as either "Available-for-Sale Investments" or "Held-to-Maturity Investments," depending on the company's intent and accounting practices. |