2. Available-For-Sale Debt Investments

What are available for sale debt investments?

Debt investments not classified as trading or held-to-maturity securities?

When is an available for sale investment a short-term investment vs long-term?

If the intent is to sell AFS securities within the longer of one year or the operating cycle, they are classified as short-term investments. Otherwise, they are classified as long-term investments.

How do we record changes in fair value for an available for sale debt investment / security?

This is done at year end usually. The gain or loss is the amount above or below the cost to buy the available for sale security.

Debit Fair Value Adjustment - Available for sale for amount of gain or loss, Credit Unrealized Gain or Unrealized Loss - Equity for amount of gain or loss.

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