Realized and Unrealized Losses: Temporary Investments
Response to the following :
An important part of GAAP for marketable securities is the distinction between investments categorized as trading, available for sale, or held to maturity.
Required:
1. What types of securities are covered by this GAAP?
2. Explain how the distinction between the three categories is made.
3. Discuss the distinction between realized and holding gains and losses on investments in debt and equity securities.
4. Explain how a company discloses realized and holding gains and losses on investments in equity securities on its financial statements.