Question

Held-to-maturity securities are reported at?

1) acquisition cost
2) acquisition cost plus amortization of a discount
3) acquisition cost plus amortization of a premium
4) fair value

Answer 1

Held-to-maturity securities are reported at their acquisition cost. These are long-term investments that a company intends to hold until maturity and are recorded at the initial cost of acquisition on the balance sheet.

Step-by-step explanation:

Held-to-maturity securities are reported at their acquisition cost. These are long-term investments that a company intends to hold until maturity, and as such, they are recorded at the initial cost of acquisition on the balance sheet. The cost includes any transaction costs incurred, such as brokerage fees or commissions.