Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

7. Receivables and Investments

Introduction to Investments in Securities

Financial Accounting

7. Receivables and Investments

Introduction to Investments in Securities

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Multiple Choice

Which of the following best distinguishes a public offering from a private placement in the context of investments in securities?

A public offering always results in higher transaction costs than a private placement due to lack of regulation.

A public offering is only available to institutional investors, whereas a private placement is open to all individual investors.

A public offering does not require registration with regulatory authorities, but a private placement does.

A public offering involves selling securities to the general public through regulated markets, while a private placement involves selling securities directly to a select group of investors without a public solicitation.

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Understand the key terms: A 'public offering' refers to the sale of securities to the general public through regulated markets, often requiring registration with regulatory authorities. A 'private placement' involves selling securities directly to a select group of investors, typically without public solicitation and with fewer regulatory requirements.

Analyze the options provided in the question to identify any inaccuracies or misconceptions. For example, consider whether public offerings always result in higher transaction costs or whether private placements are open to all individual investors.

Evaluate the regulatory requirements: Public offerings generally require registration with regulatory authorities (e.g., the SEC in the United States), while private placements are exempt from such requirements under specific conditions.

Compare the audience for each type of offering: Public offerings target the general public, including both institutional and individual investors, whereas private placements are limited to a select group of investors, often accredited or institutional investors.

Conclude by identifying the correct answer: The distinguishing feature is that a public offering involves selling securities to the general public through regulated markets, while a private placement involves selling securities directly to a select group of investors without public solicitation.