Fisher Corporation has the following investments at September 30, 2012: What method of accounting will Fisher use to account for its investment in ABC, if this investment is classified as held for trading?

Question

Fisher Corporation has the following investments at September 30, 2012:  What method of accounting will Fisher use to account for its investment in ABC, if this investment is classified as held for trading?

Quizplus · Accepted Answer

If the investment is classified as held for trading, Fisher will use the fair value through profit or loss method of accounting. This method requires the investment to be revalued to fair value at each accounting period with the changes in fair value recorded in the income statement.

Fisher Corporation Has the Following Investments at September 30, 2012