EQUITY SECURITIES AND INVESTMENTS To: Board of Directors From: Alexis Aguirre Leon Date: 05/31/2020 Subject: DEBT AND EQUITY SECURITIES Question 1: Debt and equity securities offers operating fuel which is heavily depended upon by companies to run their business and to fund their operating activities on long term and short-term basis. Companies and government seek funds through the equity and debt instruments in the market. Equity securities is a section of capital ownership in the market. Anyone who buys equity instrument becomes a shareholder meaning he owns part of the company. The benefits of being a shareholder is that there are divided that are paid to shareholders periodically. Shareholders has the voting rights in important corporate affairs such the appointment and recruitment of directors and senior managers in the company. Shares are important part of company funding since their interest rates are lower than the lending rates of the banks. In the debt instrument, there are two parties who gets into contract where one parties agrees to lead the other party some amount of money which would be repaid in the future or maturity date. Debt security include the interests, corporate bonds and account payable. Shortest time that the bond can mature is 12 months. There are secured debt securities where collateral must be provided before the lending takes place. EQUITY SECURITIES AND INVESTMENTS Question 2 Debt investment: Firms can raise through selling of debt instrument to investors whether individuals or institutions. The lender is the creditor who receives a promise that the principal amount and interest would be paid a determined date in future. Bonds, bills and notes are some of be debt investment method used by companies. When the company is being liquidated, they are paid first because they are creditor (unlike, equity financing where shareholders are not paid when company collapses since they are the owners). The cost of debt is the interest that is paid to debt investors since when a company issues debt, they promise to pay both the the principal amount and interest amount ( coupon payment) annually. Equity investment: As described earlier on, shareholders are the people who owns a portion of the company by buying the shares. This offer shares that have their values changing rapidly since the stock market is very volatile. But the volatility is mainly because of the governmental, social or political issues and not the organizations that is backing them. This is a high-risk type of investment because of the potentially high risks and rewards. Creditors are given preferential treatment during liquidation unlike shareholders. Question 3 Accounting for the debt and equity has to be done as source of capital. However, for the equity security, accounting is highly determined by the amount of influence and control over the operati.

1. EQUITY SECURITIES AND
INVESTMENTS
To:
Board of Directors
From:
Alexis Aguirre Leon
Date:
05/31/2020
Subject:
DEBT AND EQUITY SECURITIES
Question 1:
Debt and equity securities offers operating fuel which is heavily
depended upon by companies
to run their business and to fund their operating activities on
long term and short-term basis.
Companies and government seek funds through the equity and
debt instruments in the market.
Equity securities is a section of capital ownership in the market.

2. Anyone who buys equity
instrument becomes a shareholder meaning he owns part of the
company. The benefits of being
a shareholder is that there are divided that are paid to
shareholders periodically. Shareholders
has the voting rights in important corporate affairs such the
appointment and recruitment of
directors and senior managers in the company. Shares are
important part of company funding
since their interest rates are lower than the lending rates of the
banks. In the debt instrument,
there are two parties who gets into contract where one parties
agrees to lead the other party some
amount of money which would be repaid in the future or
maturity date. Debt security include
the interests, corporate bonds and account payable. Shortest
time that the bond can mature is 12
months. There are secured debt securities where collateral must
be provided before the lending
takes place.
EQUITY SECURITIES AND

3. INVESTMENTS
Question 2
Debt investment: Firms can raise through selling of debt
instrument to investors whether
individuals or institutions. The lender is the creditor who
receives a promise that the principal
amount and interest would be paid a determined date in future.
Bonds, bills and notes are some
of be debt investment method used by companies. When the
company is being liquidated, they
are paid first because they are creditor (unlike, equity financing
where shareholders are not paid
when company collapses since they are the owners). The cost of
debt is the interest that is paid
to debt investors since when a company issues debt, they
promise to pay both the the principal
amount and interest amount ( coupon payment) annually.
Equity investment: As described earlier on, shareholders are the
people who owns a portion of
the company by buying the shares. This offer shares that have
their values changing rapidly

4. since the stock market is very volatile. But the volatility is
mainly because of the governmental,
social or political issues and not the organizations that is
backing them. This is a high-risk type
of investment because of the potentially high risks and rewards.
Creditors are given preferential
treatment during liquidation unlike shareholders.
Question 3
Accounting for the debt and equity has to be done as source of
capital. However, for the equity
security, accounting is highly determined by the amount of
influence and control over the
operating decisions the lender has over the company issuing the
shares. For the shares that less
than 20%, such investor has little of no control over the issuing
company. Such case has to be
accounted for through cost method. For amount of share
between 20%- 50% of the total stock,
such investor, whether institution or individual, has significant
influence over the firm he has
invested in. such kind of equity security is accounted for using
the equity method. In the event

5. EQUITY SECURITIES AND
INVESTMENTS
the investor has stock that is higher than 50% of the total stock,
he or she has significant control.
Such kind of investment is accounted for using the consolidated
financial statement. In case of
debt security, the accounting is done using the entry in the asset
account as the debt investment.
There are acquisition costs which include investment fee of
brokers commission. The bond can
be held to maturity or sold especially the long term investment
ones. There could be a gain or
a loss when they are sold before maturity.
References
Benjamin, G., & Margulis, J. (2013). Angel capital: How to
raise early-stage private equity financing.
Hoboken, N.J: John Wiley.
ALTERNATIVE INVESTMENTS: Caia level i, set. (2019). S.l.:
JOHN WILEY & SONS.

6. Baker, H. K., Filbeck, G., & Kiymaz, H. (2015). Private equity:
Opportunities and risks.
Chorafas, D. N. (2014). The Management of Bond Investments
and Trading of Debt. Saint Louis:
Elsevier Science
References
RE: Discussion - Week 1- Building a Health History
COLLAPSE
Top of Form
Building a Health History
Patient Scenario
55-year-old Asian female living in a high-density public
housing complex
Summary of Interview
Obtaining information about a patient is effective to provide
pertinent information primarily via patient interview. The
process of patient interview can be very effective when
individualized, as with 55-year-old Asian female living in a
high-density public housing complex.
Ball et al., suggests that building a history with a patient is
essential in gaining the patient’s trust and to obtain adequate
and pertinent information. They further suggest that patients
from different backgrounds can be misunderstood, and efforts
should be made to discern their world (Ball et al., 2019).
Even though the interview process with this patient is
individualized it was conducted systematically. Effective
communication considered a prime strategy for establishing
good rapport. First, identify and introduce self to the patient,

7. and address her by name, and try to remove barriers for patient
to be more comfortable. Platt and Gordon believe
that exchanging names, sitting down, choosing a seat in reach of
patient, maintaining eye contact, and creating an environment
free from obstacles, or other distractions helps to maintain
comfort to execute a successful interview (Platt & Gordon,
2004).
After establishing rapport, clarifying the patient’s agenda by
obtaining the patient’s concerns for discussion, for example
precise symptoms, requests, and expectation. Effective listening
skills was employed which allowed for patient to express
herself freely and being nonjudgmental and the same time.
During the interview periods of silence was observed for patient
to adequately decipher what she wanted to communicate next, or
just to reflect. Ball et al., agrees that the interviewer should be
nonjudgmental, be an alert listener, also to respect silence
which is a productive tool (Ball et al., 2019).
The interview continued with gaining detailed information
about current symptoms. This was obtained by asking open
ended questions about physical, medical, surgical emotional,
family, economic, social and psychosocial history. With each
stage or phase of her history, pertinent information was
repeated for confirmation. Wu and Orlando believe that
information gained on health risk assessment is helpful to
identify risks for common and chronic illnesses (Wu & Orlando,
2015).
The interview ended successfully with a summary confirmation
of discussion and evaluating the patient’s understanding. The
opportunity was extended for patient to ask questions, expressed
fears and concerns. Arrangements made for follow up plans. I
also extended gratitude to my patient for her time and for
accommodating this interview.
Risk Assessment Tool
The health risk assessment tool was employed for this patient.
This tool was considered fitting for this patient because of her
age, race coupled with her socioeconomic status of living in a

8. high- density public complex. Because of her status, patients in
this category are mainly concerned with getting by daily with
little or no thoughts of developing or being at risk for being
diseased.
Wu & Orlando believes that the state of progressing from health
to disease, several changes transpire, that is from being healthy
to presymptomatic while feeling well and totally unaware of the
condition. They further believe that this risk assessment tool
helps to assess an individual’s risk for the development of
chronic conditions, while permitting health care providers to
develop tailored care plans, preventive care, initiating tests and
screening according to the developmental level of individuals,
to sustain and maintain adequate health. For example,
mammogram, blood works for HIV, hepatitis, cardiac profile,
and other relevant tests for middle aged women (Wu & Orlando,
2015).
Targeted Questions
Thiago et al., believe that CHD and cerebrovascular accidents
results from unhealthy eating habits sedentary lifestyle,
smoking, and excessive drinking alcohol which contributes to
almost 80% of the risk factors (Tiago et al., 2015).
Targeted questions were developed from the following based on
the patient’s history, her age and lifestyle:
1. Lifestyle behaviors on tobacco, alcohol, drug use, exercise
and eating habits.
2. Physical health relative to weight, blood pressure, cholesterol
3. Preventive health screenings for breast, colon cancer, heart
disease, hepatitis and HIV
4. Employment, financial and insurance status
5. Emotional awareness- coping with stress, depression,
expression of feelings, maintaining healthy relationships
References

9. Ball, J. W., Dains, J. E., Flynn, J. A., Solomon, B. S., &
Stewart, R. W. (2019). Seidel's guide to physical examination:
An interprofessional approach (9th ed.). St. Louis, MO: Elsevier
Mosby.
Platt, F. W., & Gordon, G. H. (2004). Field guide to the
difficult patient interview. Lippincott Williams & Wilkins.
Retrieved from https://search-ebscohost-
com.ezp.waldenulibrary.org/login.aspx?direct=true&db=cat0642
3a&AN=wal.EBC2032578&site=eds-live&scope=site
Thiago, V. J., Lima Sousa, A. L., Thais Inacio, R. P., Weimar
Kunz, S. B., Chinem, B., Jardim, L., . . . Paulo Cesar Brandao,
V. J. (2015). The natural history of cardiovascular risk factors
in health professionals: 20-year follow-up. BMC Public
Health, 15 Retrieved
from https://ezp.waldenulibrary.org/login?qurl=https%3A%2F%
2Fsearch.proquest.com%2Fdocview%2F1779676185%3Faccou
Wu, R. R., & Orlando, L. A. (2015). Implementation of health
risk assessments with family health history: Barriers and
benefits. Postgraduate Medical Journal, 91(1079), 508.
doi:http://dx.doi.org.ezp.waldenulibrary.org/10.1136/postgradm
edj-2014-133195
InformationInformationABC CompanyNumber of
Employees7Employee NameHours workedHourly rateJohn
Doe40$25.00Jane Jones40$24.00Jessie Smith40$17.00Erik
Ackers25$15.00Nan Schmit30$17.00Larry
Johnson35$18.00Christopher Hay40$18.00Assume Federal
Income Tax will be withheld at a rate of 20% for
everyone.FICA Social Security rate is 6.2% and Medicare is
1.45%.When you called your State, they told you that your State
Unemployment tax rate would be 5.4%.Recall that the Federal
Unemployment rate is the same for all
businesses.Required:Complete the Payroll Report worksheetUse
the Transactions worksheet to complete your Journal
Payroll ReportRequired: Complete the payroll report below

10. using the information provided on the Information
tab.JanuaryEmployee NameHours workedHourly rateGross
PayFederal WithholdingSocial SecurityMedicareNet John
Doe40$25.00$1,000$200$62$14.50$723.50Jane
Jones40$24.00$960$192$59.52$13.92$694.56Jessie
Smith40$17.00$680$136$42.16$9.86$491.98Erik
Ackers25$15.00$375$75$23.25$5.44$271.31Nan
Schmit30$17.00$510$102$31.62$7.40$368.98Larry
Johnson35$18.00$630$126$39.06$9.14$455.80Christopher
Hay40$18.00$720$144$44.64$10.44$520.92Totals250$134$4,8
75$975$302.25$70.69$3,527.06
TransactionsRequired: Use the transactions below to complete
your Journal on the next worksheet.Tip: Refer to pages 473-476
of your text for examples.TransactionsJanuary1Record accrued
payroll for January using the Payroll Report2Record employer
payroll taxes for the same Payroll Report (hint - remember to
record FUTA and SUTA as well)7Record payment of cash to
employees.
JournalRequired: Enter the journal entries from the transactions
found on the Transaction worksheetJournal EntriesDateAccount
TitleDebitCreditInitial RecordationGross Wages$4,875Federal
Income Tax Payable$975FICA Tax Payable social
security$302.25Medicare$70.69Wages
payable$3,527.06Accrued WagesWages
payable$3,527.06Cash$3,527.06Entry 3Federal Income Tax
Payable$975FICA Tax Payable social
security$302.25Medicare$70.69FICA Tax (employer portion)
payable$302.25Federal unemployment Payable$292.50State
unemployment Payable$263.25Cash$2,205.94
Running Head: DEALING WITH BAD DEBT

11. DEALING WITH UNCOLLECTIBLE ACCOUNTS
RECEIVABLES
Alexis Aguirre Leon
Keiser University
Date: 5-14-2020
DEALING WITH BAD DEBT 2
To: Board of directors
From: chief accountant
Date : 5/14/2020

12. Subject : why the ABC company uses allowance method to
manage bad debt
Businesses make purchases and sales on credit and later pays or
receives payment from
the customers or the creditors. The risk is usually extended
when the business extends payment
terms. While some will pay on the agreed time, other will never
pay at all. And that is why the
company incurs bad debts. If any account becomes
uncollectable, the management have to
remove the receivable from the accounting books and transfer it
to its expenses. It is transferred
to expenses because it is also cost incurred when doing
business, it is called bad debt expense. It
this study, two ways of accounting for these uncollectable
accounts will be discussed in details.
Direct method.
This method allows business to record bad debts expense only
when a given account is
considered uncollectable. The account is transferred to the bad
debt expense. It is also common
to find that a customer later sends payment. However, there is
nothing to apply the payment

13. against and if it is applied on the customers account, the
balance sheet would not balance. In
order to offset this, the customers balance is first restored in his
account and the amount paid can
be debited against customers account. The amount is never
considered revenue since the
company is just acknowledged that there is no bad debt any
more. The bad debt expense should
DEALING WITH BAD DEBT 3
be reduced. It is extreme easy way of managing bad debt when
the uncollectable accounts are
rare in a company. The matching principle is however violated
since the revenue has to be
matched with the expenses. When credit is extended to
customers, it true that a good number of
them will not be able to pay and the company may take a very
long time before exhausting its
effort to collect all the debts.
Allowance method
This method allows the company to create a bad debt expense

14. even before knowing whci
customers will pay and which will not pay. The company uses
its history to approximately how
much of its accounts are likely to bad debt. Using that
percentage, the company then calculates
how much is likely to be incurred as bad debt. The company is
then able to record bad debts.
When this entry is recorded, the account receivable cannot be
credited. A holding account
(allowance for doubtful account) is created so that once account
is deemed uncollectable, that
part of allowance can be used to reduce the account receivable.
The amount is allowance for
doubtful account just settles waiting for any of the account to
be identified an uncollectable. In
the event that a customer makes payment later, the balance in
the account receivable is restored.
The balance in the allowance account is also restored.
Each of the two methods have their advantages and
disadvantages. The internal revenue
regulating bodies ought to specify the method to used to avoid
over taxation of under taxation.
Why ABC uses the allowance method

15. Allowance has been the method that the ABC company has
adopted for a very long time
over the direct method. One reason is that account receivables
are usually reported on the
DEALING WITH BAD DEBT 4
balance sheet where the amount is likely to be greater that
amount that was collected initially.
The second reason is that the uncollectable account is identified
much later where it is removed
from the account receivable. In the direct write-off method, the
identification and removal of
uncollectable account receivable does not give time for
customer to fail to pay. Many internal
revenue services recommend the use of direct write-off method.
This is meant to prevent the
people to claim a potential bad debt expenses by just
anticipating a potential loss.
Thank you
Chief accounting office

16. DEALING WITH BAD DEBT 5
References
Warren, C. S. (2011). Survey of accounting. Mason, Ohio:
Thomson/South-Western.
Gilbertson, C. B., & Lehman, M. W. (2014). Century 21
accounting.
Hunt, M. F., & Weygandt, J. J. (2013). Problem solving survival
guide to accompany Financial
accounting, 7th edition [by] Jerry J. Weygandt, Donald E.
Kieso, Paul D. Kimmel.
Hoboken, NJ: Wiley.
References

17. Balance SheetABC COMPANYBALANCE SHEETAt December
31, 20X2 and December 31, 20X120X220X1Dollar Change%
ChangeAssetsCurrent AssetsCash and cash
equivalents$182,225143,010Trading
Securities48,00039,600Accounts receivable
28,00019,500Allowance for doubtful
accounts(5,000)(2,900)Accounts receivable,
net23,00016,600Inventories2,4503,600Prepaid expenses and
other receivables200750Available-for-sale
securities17,75014,005Total current
assets$296,625234,165Property, plant and equipment,
net304,550299,050Intangible Assets300300Total
assets$601,475533,515Liabilities and Shareholders'
EquityCurrent LiabilitiesSalaries Payable85,00061,950FICA-
Social Security Taxes Payable10,5407,682FICA-Medicare
Taxes Payable2,4651,797Employee Federal Income Taxes
Payable8,5006,000State Unemployment Taxes
Payable756540Federal Unemployment Taxes Payable8460Notes
payable or current portion of long-term
debt$24,00024,000Accounts payable14,03017,050Total current
liabilities145,375119,079Long-term debt104,400128,400Total
liabilities$249,775247,479Shareholders' equityCommon stock,
$10 per value; 50,000 shares authorized; 20,000 shares issued
and outstanding200,000200,000Retained
earnings151,70086,036Total shareholders'
equity351,700286,036Total liabilities and shareholders'
equity$601,475533,515