A company purchases debt securities for $$200,000$ at the beginning of $2022.$ It classifies $$80,000$ as trading securities and $$120,000$ as AFS securities$.$ It sells the securities in $2023.$

Required

For each of the following scenarios, indicate the net effect on income and other comprehensive income in each year $2022$ and $2023.$ In each case, any unrealized decline in value below cost is expected to be recovered and is attributed to market factors.

a$.$

Trading securities AFS securities

Fair value, end of $2022$ $$76,000$ $$130,000$

Selling price, $202386,000128,000$

Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCI.

Income OCI

End of $2022$

Answer $1$

Answer $2$

$2023$

Answer $3$

Answer $4$

b$.$

Trading securities AFS securities

Fair value, end of $2022$ $$90,000$ $$112,000$

Selling price, $202384,000136,000$

Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCI.

Income OCI

End of $2022$

Answer $5$

Answer $6$ A company purchases debt securities for $$200,000$ at the beginning of $2022.$ It classifies $$80,000$ as trading securities and $$120,000$ as AFS securities$.$ It sells the securities in $2023.$

Required

For each of the following scenarios, indicate the net effect on income and other comprehensive income in each year $2022$ and $2023.$ In each case, any unrealized decline in value

below cost is expected to be recovered and is attributed to market factors.

a$.$

Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCl.

b$.$

Note: Use a negative sign with an answer to indicate the net effect amount decreases Income or OCI.