Trading investments-What is a trading investments?
Trading investment is prepared to buy the securities market in the near future from the sale of investments.
Trading conditions for investment accounts:
Investment account as a transaction subject to the following two conditions:
1, can be traded on the open market and a clear market value.
2, not intended for long-term investment needs, but to win the stock market spread income.
Trading investment - recorded time:
Cash assets or transfer of non-cash assets of the time.
Trading investments - value and financial processing
1, the initial cost of the measurement
A, when enterprises to obtain fair value recorded in "Trading financial assets" account (not including the price has not been included in the declared cash dividends or bond interest)
B, have been included in the price paid has not yet declared a cash dividend or bond interest shall be credited to "dividends receivable" or "interest receivable"
C, taxes, fees and other related expenses recorded in "investment income" account.
2, the account settings:
(1) trading financial assets
- Stock (bonds, funds) --- Cost
- Stock (bonds, funds) --- Changes in fair value
(Asset categories: accounting transactions of financial assets at fair value)
3, the time of purchase accounting entries:
By: Trading financial assets --×××( costs)
Investment income
Dividends receivable / accrued interest
Credit: Other monetary funds - investment funds kept out of
4, handle cash dividends or interest on bonds
(1), received the purchase price included cash dividends declared or interest, write-downs "dividends receivable" or "interest receivable."
(2), received from the investee held during the distribution of cash dividends or interest, identified as "investment income."
During the receipt of purchase or cash dividends have been declared interest on bonds
By: Other monetary funds (and other)
- Keep the money invested
Credit: Accounts dividends / interest receivable
During the holders of dividends declared or interest paid
By: Dividends receivable \ interest receivable
Credit: Investment income
When actually received:
By: Other monetary funds (and other)
- Keep the money invested
Credit: interest receivable \ interest receivable
Note: holding back stock during the period from dividends, not to deal with accounts, only in the reference book to increase the number of registered shares.
6, trading investments - sale process
A, by: bank deposit
Credit: Trading financial assets
- × × company × × (cost)
- × × company × × (fair value)
Note: The difference between the loan-by or "investment income"
At the same time
By: changes in fair values
Credit: Investment income
B, by: bank deposit
Trading financial assets
- × × company × × (fair value)
Credit: Trading financial assets
- × × company × × (cost)
Note: The difference between the loan-by or "investment income"
At the same time
By: Investment income
Credit: changes in fair values
