Elyse Inc.made the following investments during its 2016 fiscal year.
a.The company places $3,000 in a 8-month term deposit with its bank.
b.The company purchases from its broker a call option on 2,500 shares of BMO Financial,a publicly traded company,for $5,500,in anticipation of an increase in the stock price.
c.The company buys 30% of the outstanding shares of NEXT Corp.The purchase was made in anticipation of a bid by BEFORE Corp.to purchase all of the shares of NEXT within the next nine months.
d.The company buys $35,000 of shares in a publicly traded corporation with a market capitalization of more than $20 billion.
Required:
Identify how the company should categorize the above financial assets.Briefly explain the reason for the classification.

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The Answer of Elyse Inc.made the following investments during its 2016 fiscal year.
a.The company places $3,000 in a 8-month term deposit with its bank.
b.The company purchases from its broker a call option on 2,500 shares of BMO Financial,a publicly traded company,for $5,500,in anticipation of an increase in the stock price.
c.The company buys 30% of the outstanding shares of NEXT Corp.The purchase was made in anticipation of a bid by BEFORE Corp.to purchase all of the shares of NEXT within the next nine months.
d.The company buys $35,000 of shares in a publicly traded corporation with a market capitalization of more than $20 billion.
Required:
Identify how the company should categorize the above financial assets.Briefly explain the reason for the classification.

Elyse IncMade the Following Investments During Its 2016 Fiscal Year