Fisher Corporation has the following investments at December 31, 2012: If Fisher classifies its investment in Brooke as held to maturity, what amount will be reported in Fisher's 2012 year-end balance sheet?

Question

Fisher Corporation has the following investments at December 31, 2012:  If Fisher classifies its investment in Brooke as held to maturity, what amount will be reported in Fisher's 2012 year-end balance sheet?

Quizplus · Accepted Answer

If Fisher Corporation classifies its investment in Brooke as held to maturity, it will be reported at amortized cost on the balance sheet. The amortized cost of the investment is the purchase price of $10,000 plus any premium or discount amortized over the life of the investment. Since no premium or discount is given in the question, the amount reported on balance sheet will be $10,000.

Fisher Corporation Has the Following Investments at December 31, 2012