When Transferring Investments Between Categories, Unrealized Holding Gains for Securities

question 104

Multiple Choice

When transferring investments between categories, unrealized holding gains for securities transferred from trading to available-for-sale

• A) must be realized on the income statement
• B) must be recognized on the income statement
• C) must be realized and reported in comprehensive income
• D) need no accounting since it has already been recognized in net income

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Definitions:

Pension Rights

The entitlements employees earn towards future pension benefits as a result of their employment.

Vacation Privileges

Benefits or allowances offered by employers to employees, allowing paid time off from work for personal leisure or rest.

Operations

The activities involved in the day-to-day running of a business for the purpose of producing value for the stakeholders.

Salaries Payable

A liability account that records the amounts owed to employees for work performed but not yet paid.