Learning Objective $15-$C$1$: Distinguish between debt and equity securities and between short$-$term and long$-$term investments.

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Debt securities reflect a creditor relationship and include investments in notes, bonds, and certificates of deposit. Equity securities reflect an owner relationship and include shares of stock issued by other companies. Short$-$term investments in securities are current assets that meet two criteria: $(1)$ They are expected to be converted into cash within one year and $(2)$ they are readily convertible to cash, or marketable. All other investments in securities are long term. Long$-$term investments also include assets not used in operations and those held for special purposes, such as land for expansion. Investments in securities are classified into one of six groups.