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Hello guys I have a firm understanding of where unrealized gains or losses from fair value changes in securities go. But I find contractory info on becker. Based on the book, the unrealized gain or loss that arises on the day of reclassification should follow the rules of its new classification.
Ex: if reclassified to trading it will hit earnings on the income statement
Ex: if reclassified to Available. For sale it will hit other comprehensive incomeBut in one of the questions they have securities that were reclassified from trading to avaliable for sale with an unrealized loss of $45,000 that arose on the day of reclassification and they threw the loss into the income statement rather than other comprehensive income.
Shouldnt these unrealized gains and losses follow it’s new reclassification?
Does anyone have any feedback of how to approach this rule? I’m good pretty much on all other securities rules except for this glitch.
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