1.
Determine the unrealized holding gain or loss on the note.
Unrealized holding gain or loss = Carrying value - Fair value = $16,000 - $17,500 = ($1,500)
2.
Prepare the entry to record any unrealized holding gain or loss.
Account Titles and Explanation | Debit | Credit |
Unrealized holding gain or loss - equity | $1,500 | |
Notes Payable | $1,500 |
Brief Exercise 14-14 Shonen Knife Corporation has elected to use the fair value option for one...
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