Question

Grunwald elected to report its bonds at fair value. During the current year, the fair value of the bonds increased due to changes in the related credit risk. Grunwald should report the gain:

Answer 1

The way that Grunwald has to report the gain that is made by the fair value would be report it as part of OCI.

What is an OCI from bond?

This is a term that is used to refer to the balance that exists between the net income and also comprehensive income.

A very good example of this income is a bond that is yet to get to its maturity and so has not been redeemed.

Read more on bonds here:

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