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Assume Intervale Railway is considering investing in Pale Co. stock for three months. The investment will represent 5% of the voting stock of Pale Co. How would the investment be classified?a. Significant interest investmentb. Trading investmentc. Held-to-maturity investmentd. Controlling interest investment

Respuesta :

Answer:

Option b (trading investment) is the correct choice.

Explanation:

  • Usually, the word 'trade investment' becomes interpreted as another expenditure undertaken by a corporation in certain company's securities or debentures towards supporting the initial company's transaction either business.
  • Trading securities involve commodities or assets which are already intended by the administrators to start buying to generate money initially.

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