Question

The amounts indicated pertain to Royal Fairmont’s trading debt investments, which were purchased on 1/1/21: Cost: $16,000 12/31/21 Fair Value: $15,000 12/31/22 Fair Value: $11,000 The amount included in 2022 Comprehensive Income will be:

Answer 1

Answer:

loss of $5,000 on adjustment of trading debt investments

Explanation:

The comprehensive income statement records gains and losses on the trading debt investments.

By the end of 2022 the trading debt investments had fallen in value to $11,000 from  $15,000 representing a loss of $5,000 to be adjusted in the income statement.