Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

11. Which of the following is false about trading securities? a. Trading securities are carried at fair value in the balance sheet b. The investment

image text in transcribed
11. Which of the following is false about trading securities? a. Trading securities are carried at fair value in the balance sheet b. The investment account is increased/decreased to reflect the fair value c. Unrealized holding gains and losses on trading securities are included in the net income of the income statement d. Trading securities typically are intended to be sold in the near future 12. S\&L Financial buys and sells securities which it classifies as available-for-sale. On December 31 , 2024 , a bond has an amortized cost of $800,000. The bond's fair value adjustment has a debit balance of $20,000, but the bond's fair value is now $825,000. The journal entry to adjust the fai value adjustment will include: a. Debit to fair value adjustment for $5,000 b. Credit to fair value adjustment for $5,000 c. Debit to unrealized holding gain on AFS investments-OCI for $5,000 d. Credit to fair value adjustment for $25,000 11. Which of the following is false about trading securities? a. Trading securities are carried at fair value in the balance sheet b. The investment account is increased/decreased to reflect the fair value c. Unrealized holding gains and losses on trading securities are included in the net income of the income statement d. Trading securities typically are intended to be sold in the near future 12. S\&L Financial buys and sells securities which it classifies as available-for-sale. On December 31 , 2024 , a bond has an amortized cost of $800,000. The bond's fair value adjustment has a debit balance of $20,000, but the bond's fair value is now $825,000. The journal entry to adjust the fai value adjustment will include: a. Debit to fair value adjustment for $5,000 b. Credit to fair value adjustment for $5,000 c. Debit to unrealized holding gain on AFS investments-OCI for $5,000 d. Credit to fair value adjustment for $25,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

2. Are my sources up to date?

Answered: 1 week ago