please help on this question;
On p591 of Wiley FAR 2013 book, question 7
Module 16: Investments
the marketable equity securities of a company is as following:
cost 12/31/Y2(FV) 12/31/Y1(FV)
Trading 150,000 155000 100000
AFS 150,000 130000 100000
it asks what amount should the company report as unrealized holding gain in Y2 income statement, assuming it does not use the fair value option to report its investments?
my question 1 is: since, the securities are trading and AFS, how can it not use FV option to report? I think all trading and AFS need to be reported by FV options according to the table on p.579
question 2, the ansower excluded the 10k FV change of AFS becuase that belongs to OCI, so when the question mention Y2 income statement, that does not include OCI?
Thanks for any ideas
