Question

Hobson Company bought the securities listed below during 2020. These securities were classified as trading securities. In its December 31, 2020, income statement Hobson reported a net unrealized holding loss of $15,500 on these securities. Pertinent data at the end of June 2021 is as follows:

Security Cost Fair Value
X $371,000 $343,500
Y 185,000 162,400
Z 424,000 407,800

Required:
What amount of unrealized holding loss on these securities should Hobson include in its income statement for the six months ended June 30, 2021?

Answer 1

$50,800

Step-by-step explanation:

Security Cost Fair value Gain(loss)

X 371,000 343,500 -27,500

Y 185,000 162,400 -22,600

Z 424,000 407,800 -16,200

Total 980,000 913,700 -66,300

Unrealized holding loss on Income statement ended June 30,2021 = $66,300 - $15,500 = $50,800