On January 12th, 2018 Jefferson Corporation purchased bonds of Rose Corporation for $73 million and classified the securities as available-for-sale. On December 31st, 2018 these bonds were valued at $67 million. Eight months later, on October 3rd, 2019 Jefferson Corporation sold these bonds for $87 million.
- As part of the multi-step approach to record the 2019 transaction, Jefferson Corporation should next take the second step of:

Question

Quizplus · Accepted Answer

2018 unrealized holding loss of $6 million offset by 2019 unrealized holding gain of $20 million = $14 million accumulated unrealized holding gain. Alternatively, the accumulated unrealized holding gain from date of purchase to date of sale is $87 million (sale) - $73 million (purchase) = $14 million accumulated unrealized holding gain.

On January 12th, 2018 Jefferson Corporation Purchased Bonds of Rose