What is Long-Term Investments?
An account on the asset side of a company’s balance sheet that represents the investments that a company intends to hold for more than a year. They may include stocks, bonds, real estate and cash. Read more for examples and further explanation including related video clips and also comments
Example explains Long-Term Investments
The long-term investments account differs largely from the short-term investments account in that the short-term investments will most likely be sold, whereas the long-term investments may never be sold.
A common form of this type of investing occurs when company A invests largely in company B and gains significant influence over company B without having a majority of the voting shares. In this case, the purchase price would be shown as a long-term investment.
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