A year-end analysis of Valencia Inc.'s equity securities portfolio acquired in 2010 shows the following totals at December 31, 2010 for FVPL and available-for-sale securities:

$\begin{array}{lrr}&\text { FVPL } & \text { Available-for-Sale } \
&\text { Securities } & \text { Securities }\
\text { Aggregate cost } & € 900,000 & € 1,100,000 \
\text { Aggregate fair cost } & 650,000 & 950,000
\end{array}$

What amount of unrealized holding loss should Valencia report in its 2010 income statement?

Question

A year-end analysis of Valencia Inc.'s equity securities portfolio acquired in 2010 shows the following totals at December 31, 2010 for FVPL and available-for-sale securities:

$\begin{array}{lrr}&\text { FVPL } & \text { Available-for-Sale } \
&\text { Securities } & \text { Securities }\
\text { Aggregate cost } & € 900,000 & € 1,100,000 \
\text { Aggregate fair cost } & 650,000 & 950,000
\end{array}$

What amount of unrealized holding loss should Valencia report in its 2010 income statement?

Quizplus · Accepted Answer

Unrealized holding losses for FVPL securities are reported in the income statement. The loss is calculated as the difference between the aggregate cost and the aggregate fair value: €900,000 - €650,000 = €250,000.

A Year-End Analysis of Valencia Inc What Amount of Unrealized Holding Loss Should Valencia Report in in 2010