Final answer:
We analyzed financial data from Church Financial's December 2024 statements, focusing on the change in investments at FVTPL, which showed an increase affected by a holding gain and a loss on sale, leading to an investment income loss.
Step-by-step explanation:
The question revolves around the financial concepts of investments at FVTPL (Fair Value Through Profit or Loss) and concerns how to report changes in investment value, including both holding gains and losses on sales, as per the information provided in the financial statements of Church Financial for December 31, 2024. We analyze the increase in the investments at FVTPL from $11,000 to $15,000 and take into account the investment income or (loss) of ($500), which is a result of a $2,500 holding gain and a $3,000 loss on the sale of the investments. To understand the transactions, we consider the carrying amount for the sold investments was $4,000.
To calculate the investments at fair value through profit or loss, we can assess the beginning balance plus the holding gain and then subtract the loss from the sale of the investments to understand the end balance and the income or loss recorded:
Beginning balance (December 31, 2023): $11,000
Plus: Holding gain: $2,500
Less: Loss on sale of FVTPL investments: $3,000
Ending balance (December 31, 2024): $15,000
The ending balance reflects both the realized and unrealized gains and losses on the FVTPL investments that Church Financial holds for trading purposes as of December 31, 2024.