Question 7 [5 marks] Complete the following statements given in a) c). (selected topics from Sections #1 and #2)

a) Firms can buy back their own shares for various reasons, such as the preparation for the exercise of (i) ____, and may keep the repurchased shares as (ii) _____.

Answer: i) ii)

b) The accounting rules for a firms financial investments depend on the level of influence and control the firm has over the investee firm, primarily determined by the _______. . Answer: c) If a firm has no intention to hold the bond until its maturity, its investment in a bond may be classified as trading securities or _________ securities.

Answer: