Hampton Company has a debit balance in the Fair Value Adjustment account that is associated with its Equity Securities portfolio at December 31, 2025. Which of the following statements is true regarding Hampton’s 2025 financial statements? (a) Hampton will report an unrealized holding gain in net income (b) The account balance will be reported as an addition to the Equity Securities account to report the securities at fair value on the balance sheet (c) Hampton will report an unrealized holding gain in comprehensive income (d) The debit balance represents the difference between the securities’ amortized cost and their fair value and is reported as an additional to the Equity Securities account on the balance sheet

Hampton Company has a debit balance in the Fair Value Adjustment account that is associated with its Equity Securities portfolio at December 31, 2025. Which of the following statements is true regarding Hampton’s 2025 financial statements? (a) Hampton will report an unrealized holding gain in net income (b) The account balance will be reported as an addition to the Equity Securities account to report the securities at fair value on the balance sheet (c) Hampton will report an unrealized holding gain in comprehensive income (d) The debit balance represents the difference between the securities’ amortized cost and their fair value and is reported as an additional to the Equity Securities account on the balance sheet

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 9E

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