All categories

2 years ago

Unrealized holding gains or losses which are recognized in income are from debt securities classified as

Business

1 answer:

Serga [27]2 years ago

3 0

Answer:

Trading.

Explanation:

In Business management, when a gain or loss is realized, it simply means that the owner of stock or other securities has sold it. Thus, these unrealized gains or losses are generally referred to as paper profits or losses.

Basically, when the value of a stock being bought by an investor reduces (falls) while he or she is yet to sell it, it is known as an unrealized loss.

However, when the value of a stock being bought by an investor rises (increases) while he or she is yet to sell it, it is known as an unrealized gains.

Hence, unrealized holding gains or losses which are recognized in income are from debt securities classified as trading.

You might be interested in

Industry conditions change A. because of newly emerging industry threats and industry opportunities that alter the composition o

kap26 [50]

Answer:

E. because forces create pressures or incentives for industry participants (competitors, customers, suppliers) to alter their actions in important ways.

Explanation:

Industries can be described as different manufacturers producing a kind of particular goods or services.

Industry conditions are situations whereby there would be pressure among the compititors or customers in this industry which result to changing of their action in one way or the other which can influence the industry in positive or negative way.

We have different industries such as automobile, mining, food service and others.

8 0

2 years ago

On July 1, 20X1, Mirage Company issued $250 million of bonds with an 8% coupon interest rate. The bonds mature in 10 years and p

hoa [83]

Answer: See explanation

Explanation:

a. At what price were the bonds issued?

The bonds were issued at $250 million since the issue price will have thesame value as the face value in this case.

b. On July 1, 2019, the market interest rate for bonds of this risk class is 6%. What is the fair value of the bonds on this date?

The fair value of the bond on this date will be:

= {$250,000,000 × 4% × [(1-1.03)^-16]0.03} + {$250,000,000 × (1/1.03)^-16}

= $281402755

c. Suppose that 50% of the bonds were repurchased for cash on July 1, 2019, at the market price. What journal entry would the company make to record this partial retirement?

The journal entry will be:

July 1 ,2019

Debit Bond payable $250,000,000/2 = $125,000,000

Debit loss on bond redemption = $140,701,378 - $125,000,000 = $15,701,378

Credit Cash $281402755 × 50% = $140,701,378

(To record bond payable redemption)

7 0

2 years ago

Midshipmen Company borrows $11,500 from Falcon Company on July 1, 2018. Midshipmen repays the amount borrowed and pays interest

hoa [83]

Answer:

Part 1:

Account Debit Credit

Cash $11,500

Notes Payable $11,500

(On 12% Interest)

Part 2:

Account Debit Credit

Interest Expense $690

Interest Payable $690

Part 3:

Interest Expense = $690

Interest Payable = $690

Explanation:

Part 1:

July 1, 2018 Midshipmen borrows $11,500 from Falcon Company.

Account Debit Credit

Cash $11,500

Notes Payable $11,500

(On 12% Interest)

Part 2:

From july 1,2018 to Dec 31,2018, Interest expense has accumulated for 6 months. Since each month the interest is 1% so For each month interest is

($11500 * 1% = $115).

For 6 months Interest expense = $115 * 6

For 6 months Interest expense = $690

General Entry:

Account Debit Credit

Interest Expense $690

Interest Payable $690

Part 3:

Same as Part 2 i.e

From july 1,2018 to Dec 31,2018, Interest expense has accumulated for 6 months. Since each month the interest is 1% so For each month interest is

($11500 * 1% = $115).

For 6 months Interest expense = $115 * 6

For 6 months Interest expense = $690

Interest Expense = $690

Interest Payable = $690

5 0

2 years ago

The body of a routine message that requests information or action should

Papessa [141]

Your answer is A.) present details that explain your request

3 0

3 years ago

Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For the valuation of bonds that make semiannual payments,

navik [9.2K]

Answer:

market value of treasury notes

PV of face value = $4,000,000 / (1 + 3.8%)⁶ = $3,197,981

PV of coupon payments = $120,000 x 5.27644 = $633,173

market value = $3,831,154

the T-note is being sold at a discount since the YTM is higher than the coupon rate. As the bond approaches maturity, its market value should increase.

5 0

2 years ago