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Chapter 13: Q17-7Q (page 658)

Question: At what amount should trading, available-for-sale, and held-to-maturity debt securities be reported on the balance sheet?

Short Answer

Expert verified

Answer:

Trading and available-for-sale are reported on the fair of the securities, whereas held-to-maturity securities are treated as amortized costs while reporting it.

Step by step solution

01

Definition of held-to-maturity debt securities

Held-to-maturity is a type of debt security that the company holds until the maturity of the debt security.

02

Reporting in balance sheet

Trading debt securities are reported on the fair value. Securities available-for-sale is also reported on the fair value of the security. The fair value of securities will be in the same currency used at the time of the issue. Securities held-to-maturity is treated as the amortized cost while reporting it.

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