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In the United States, GAAP for investments in debt instruments require companies to recognise unrealized gains and losses on investments in trading securities in the income statement. However, unrealized gains and losses on investments in securities available for sale are not recognised in the income statement; they are recognised in the equity section of the balance sheet.

Consider the potential reasons for the divergent treatment of these unrealized gains and losses.

Basic Finance, Finance

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  • Reference No.:- M942773

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