The Advantage of Using Fair Value for Investments Held for Trading

question 172

True/False

The advantage of using fair value for investments held for trading is that it allows users to better predict future cash flows.

---

Definitions:

Previous Balance

The amount of money that was owed at the end of the last billing cycle in financial accounts and credit statements.

Cycle Closing

Cycle Closing refers to the process of finalizing all transactions and balances for a specific accounting period, ensuring that all financial activities within that period are accounted for and concluded.

Simple Interest

Simple interest is a method of calculating the interest charge on a loan based on the original principal amount and the interest rate, without compounding over time.

Monthly Basis

A term referring to events or calculations repeated or measured every month.