Question

Which type of investment in securities must always be classified as a current asset? held-to-maturity debt...

Which type of investment in securities must always be classified as a current asset?

held-to-maturity debt securities

available-for-sale securities

trading securities

none of the these, they may all be classified as current or long-term assets
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Answer #1

Solution:

Held for maturity securities are may current assets or long term assets depending upon the maturity date. If it is mature within 1 year then it is current assets otherwise long term assets.

Available for sale securities is also may be long term or current assets depending upon the date of sales. If the securities sale with 1 year then it is current assets otherwise non current assets.

But trading securities is always current assets. Because they are converted into cash within one year and listed at their current market value.

So the correct answer is Trading Securities.

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