Share
Explore BrainMass

Accounting for Investments in Securities

As of December 31, 2011, Company A has the following investments in marketable securities:

Investment: Acquisition Cost ; 12/31/2011 Market Value
Trading Portfolio - Company B Common Stock: $120,000 ; $110,000
Available for Sale Portfolio - Company C Common Stock: $350,000 ; $365,000
Hold-To-Maturity Portfolio - Company D Debentures: $500,000 ; $495,000

All three investments were purchased in 2011. In 2012, Company A sold its investment in Company B for $118,000 and its investment in Company C for $359,000. As of December, 2012, the market value of the investments in Company D Debentures was $499,000. Calculate the following and indicate if gain or loss

Realized holding gain/loss recognized in the income statement in 2011

Unrealized holding gain/loss recognized in other comprehensive income in 2011

Realized holding gain/loss recognized in the income statement in 2012

Unrealized holding gain/loss recognized in other comprehensive income in 2012

Balance of accumulated other comprehensive income as of December 31, 2012

Solution Summary

This solution illustrates how to compute the realized and unrealized gains and losses from marketable securities transactions.

$2.19