Case 8-1

FASB ASC 320 requires comoanies to assign their portfolio of investment securities into

1. trading securities 2. securities available for sale 3. held-to-maturity securities

Required:

A. define each of these categories of securities and discuss the accounting treatment of each category

B. discuss how companies are required to assign each category of securities into its current and noncurrent portions.

C. some individuals maintain that he only proper accounting treantment for all marketable securities its current value. others maintain that this treatment might allow companies to "manage earnings". discuss the arguments for each position.