The gain on AFS securities reported on the 2016 income statement is a. $ 3,000 b. $
Question:
The gain on AFS securities reported on the 2016 income statement is
a. $ 3,000
b. $ 4,000
c. $ 9,000
d. \($10,000\)
On January 1, 2016, a company’s balance sheet reports its investments in financial instruments as follows:
Additional information:
a. The HTM securities are \($200,000\) face value debt securities purchased on January 1, 2014, at a yield of 4%. The securities have a 4-year total life and pay interest annually on December 31, at a coupon rate of 6%.
b. The trading securities on hand on January 1 were sold in 2016 for $180,000.
c. More trading securities were purchased for \($100,000\). They are still on hand at December 31, 2016, and have a fair value of $125,000.
d. AFS securities, originally purchased for \($26,000\) with a carrying value of \($25,000\) as of January 1, 2016, were sold for $29,000.
e. AFS securities on hand at December 31, 2016, have a fair value of $81,000.
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