Any unrealized gains or losses on trading securities would have to be added back to or subtracted from net income on the statement of cash flows under the indirect method of determining cash flows from operating activities.

Question

Quizplus · Accepted Answer

According to the indirect method of determining cash flows from operating activities, unrealized gains or losses on trading securities are categorized as non-cash items and therefore have to be added back to or subtracted from net income on the statement of cash flows. This is because these gains or losses do not involve cash inflows or outflows and are considered only accounting adjustments.

Any Unrealized Gains or Losses on Trading Securities Would Have