Week 5 Team Assignment
Team C
ACC/545
October 12, 2015
Instrucor Name
University of Phoenix

Introduction Investments and marketable securities are very important when a company is in need of capital. If a company is need to report cash earnings at a higher rate as to not float expenses then short-term investments will be needed. However when dealing with marketable securities the maturity date will be in question as to journalize the transactions as capital or a cash equivalent. Both are very important to a company’s decision to raise capital and or to invest. The direction in which will be followed will need to be reviewed properly to make sure the end-line results that was needed for the intended investment and recording of such investment.
What are the differences between investments and marketable securities?
Marketable securities are common stock, certificates of deposit or Treasury Bills that are cashed out or sold within a year. These are classified as cash equivalents because they are highly liquid. Investments such as stocks are not considered cash equivalents.
Marketable securities are current liquid assets because it can quickly be turned into cash and the business must have the intent to turn the investment into cash. An investment cannot be turned into cash quickly and is usually held for longer than one year.
Identify criterion for differing marketable securities in your response.
One major criterion is that marketable securities can easily be converted to cash. Marketable securities provide investors with liquidity. The key feature to marketable securities is how easily they can be bought and sold and converted to cash.
How do different business combinations affect cash flow?
Business combinations have the effect that the cash flow will have a cash outflow. Cash is used to perform the business combination. Additionally, the cash