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

Question

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

Quizplus · Accepted Answer

As of December 31, 2014, the fair value of the trading securities is $93,000 ($100,000 market value - $7,000 unrealized loss). Since this represents a decrease in fair value from the original cost of $100,000, Saddle, Inc. must recognize this as an unrealized loss on its income statement. Therefore, the answer is C, $7,000 unrealized loss.

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