At December 31, 2014, the trading securities for Mayfair, Inc. are as follows: Mayfair should report the following amount related to the securities in its 2014 income statement:

Question

At December 31, 2014, the trading securities for Mayfair, Inc. are as follows:  Mayfair should report the following amount related to the securities in its 2014 income statement:

Quizplus · Accepted Answer

The securities have a fair market value of $123,000 on December 31, 2014, but Mayfair originally purchased them for $130,000. This means that there is an unrealized loss of $7,000 ($130,000 - $123,000) at the end of the year. Since this is an unrealized loss, it does not get reported on the income statement but instead goes on the balance sheet as a reduction in the value of the trading securities.

At December 31, 2014, the Trading Securities for Mayfair, Inc