Fair Value Option (Investment Securities, Unrealized Gains & Losses As Part Of Net Income)
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11 سال پیش
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Accounting for Equity securities with
Accounting for Equity securities with the Fair Value Option, Guidelines for Fair Value Option: 1-Elected on an investment-by-investment (Individual) basis rather than on a portfolio basis, 2-Generally available only at the time a company first purchases the securities, 3-Once choosen must measure the security at fair value until no longer owned, example compares the Equtiy Method with the Fair Value Option for recording Equity securities, Fair Value Option records each investment on an individual basis & any unrealized holding gain or loss is included in Net Income for the current period, example, Corp-A purchases stock of Corp-B, has an equity ownership & elects to report this security using the Fair Value Option Corp-A acquired 25% of 200,000 shares of C/S of Corp-B: 1-Cost of $28/share on (3/1/X1), 2-Market Price of C/S was a. $30/share on (12/31/X1), b. $24/share on (12/31/X2), c. $36/share on (12/31/X3), 3-Corp-B paid Dividend each year & had Net Income, A-Does not report share of Net Income /Loss, B-Dividends rec'd (Cr) Dividend Revenue, detailed accounting by Allen Mursau
11 سال پیش
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