The trading financial assets in the balance sheet refer to the financial assets held by the enterprise for short-term trading, such as **, bonds, **, etc. The method of calculating a tradable financial asset can vary depending on the specific accounting standards and accounting regime, but in general, it can be calculated by the following steps:
Determine the initial investment cost of a tradable financial assetThe initial investment cost is the amount of cash or cash equivalents paid by a business to purchase a trading financial asset. If a business trades non-cash assets for trading financial assets, the initial investment cost also includes the fair value of the non-cash assets exchanged.
Calculating the change in fair value of a trading financial asset:Fair value change refers to the change in value of a trading financial asset due to market fluctuations during the holding period. If the market** rises, the fair value change is positive;If the market** declines, the fair value change is negative.
Calculation of the closing balance of a trading financial asset:The closing balance refers to the carrying amount of a trading financial asset at the end of the period, which is equal to the initial investment cost plus the change in fair value.
The specific calculation formula is as follows:
Closing Balance = Cost of Initial Investment + Change in Fair Value
If the fair value change is positive, then the closing balance = the initial investment cost + the fair value change;If the fair value change is negative, then the closing balance = the initial investment cost - the fair value change.
It is important to note that factors such as transaction fees also need to be taken into account when calculating the closing balance of a trading financial asset. In addition, if there is interest or dividend income during the period during which the company holds the trading financial asset, it needs to include this part of the income in the investment income account and subtract it from the closing balance.
In summary, the calculation of the closing balance of a trading financial asset requires a combination of factors such as the cost of the initial investment, changes in fair value, and interest or dividend income. In practice, it is necessary to make corresponding adjustments and modifications according to specific accounting standards and accounting systems.