Target Corporation prepares its financial statements according to U.S. GAAP. Target's financial statements and disclosure notes for the year ended January 30, 2016, are available Connect. This material also is available under the Investor Relations link at the company's website (www.target.com). Target does not have investments in stock or bonds. However, CVS Health Corp., which purchased Target's pharmacy and clinical business during 2015, does have some investments. Access CVS's 2015 10K (issued on February 9, 2016) at investors.cvshealth.com to answer the following questions,

Required:

1. CVS indicates in Note 1 that it has some short-term investments that consist of certificates of deposit (CDs).

a. How has CVS classified those CDs for accounting purposes?

b. Per CVS's balance sheet, what was the balance in CVS's short-term investments as of December 31, 2015 and December 31, 2014?

c. Per CVS's statement of cash flows, what cash transactions affected short-term investments during 2015?

d. Prepare a T-account that summarizes transactions affecting CVS's short-term investments during 2015. Speculate as to the explanation for any "plug" figure necessary to make the T-account balance.

2. Per Note 1, CVS has equity-method investments in SureScripts, LLC and in Heartland Healthcare Services. CVS indicates that those investments are immaterial for the year ended December 31, 2015. Assuming that the Heartland investment is material,

a. How would Heartland's earnings affect CVS's income statement?

b. How would Heartland's earnings affect CVS's balance sheet?