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

In the context of investments in securities, money invested is usually used to do which of the following?

Distribute dividends to shareholders

Purchase financial assets such as stocks or bonds

Pay off existing company debts

Cover daily operating expenses

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Verified step by step guidance

Understand the concept of investments in securities: Investments in securities refer to the allocation of money into financial assets such as stocks, bonds, or other instruments with the expectation of earning returns over time.

Analyze the options provided: The question asks what money invested in securities is typically used for. Review each option carefully to determine its relevance to the concept of securities investments.

Option 1: Distribute dividends to shareholders. Dividends are payments made to shareholders from a company's profits, not directly related to the act of investing in securities.

Option 3: Pay off existing company debts. Paying off debts is a financial management activity, not the primary purpose of investing in securities.

Option 4: Cover daily operating expenses. Operating expenses are part of a company's day-to-day activities and are not typically funded through investments in securities. The correct purpose is to purchase financial assets such as stocks or bonds, as these are the instruments involved in securities investments.