Question

Jan.​ 14: Purchased 800 shares of Phyflexon ​stock, paying $50 per share. The investment represents ownership in voting stock. does not have significant influence over . intends to hold the investment for the indefinite future.

Answer 1

The Phyflexon stock investment representing ownership in voting stock implies that the investor intends to hold the investment for the indefinite future. It is to be classified as common stock.

Step-by-step explanation:

Since the investor intends to hold the investment for the indefinite future, he is entitled to dividends when declared. The investment is classified as held to maturity (indefinite) and accounted for using the equity method.