Sumner sold equipment that it uses in its business for $31,800. Sumner bought the equipment a few years ago for $79,100 and has
claimed $39,550 of depreciation expense. Assuming that this is Sumner's only disposition during the year, what is the amount and character of Sumner's gain or loss
Available-for-sale securities simply refers to the debt securities that are bought but with the intention that they'll be sold before they mature. They're typically reported at their fair value.
The gain that will be reported by Jeremiah Corporation in the December 31, 2021, income statement relative to the portfolio is $0. This is because for available-for-sale securities, there'll be no reports on holding gains or losses incurred.
c. The maturity risk premium is assumed to be zero.
Explanation:
In the case when the term structure of the rate of interest would be measured via the pure expectations theory so here the maturity risk premium would be zero as under this theory it is assumed that the risk premium i.e. of the long term would be equivalent to the zero
