When an impairment of securities available for sale occurs for a reason that is judged to be "other than temporary," the investment is written down to its fair market value and the amount of the write-down is:

Question

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When an impairment of securities available for sale occurs for a reason that is judged to be "other than temporary," the investment is written down to its fair market value and the amount of the write-down is included in income. This means that the loss is recognized on the income statement as a realized loss, rather than being treated as unrealized. The other options (A, C, D) are not correct, as a deferred credit or asset would not be appropriate for recognizing a realized loss, and treating the loss as unrealized would not accurately reflect the change in value of the investment.

When an Impairment of Securities Available for Sale Occurs for a Reason