What is the difference between fair value change income and investment income

First, the nature is different.

1. Fair value change income: An account of trading financial assets measured at fair value through profit or loss.

2. Investment income: refers to the income obtained by enterprises or individuals from foreign investment (the losses incurred are negative).

Second, the accounting treatment is different.

1. Fair value change income: Fair value change income is a new account added under the new accounting standards, when an enterprise makes provision for "bad debts, inventory decline provision, and held-to-maturity investment impairment provision", under the old accounting standards, the provision for bad debts and inventory decline are debited to "management expenses" and credited to "bad debt provision, inventory decline provision", etc.

2. Investment income: This subject should be accounted for in detail according to the investment project.

Third, the characteristics are different.

1. Fair value change gain: "fair value change of trading financial assets" should be debited and "fair value change profit or loss" should be credited, and the difference between fair value and its book value should be reversed.

2. Investment income: the net income of profits, dividends and bond interest obtained from foreign investment minus investment losses.

Encyclopedia - Investment income.

Encyclopedia - Fair Value Change Income.

1. Different ways of earning:

Investment income refers to the income obtained by enterprises or individuals from foreign investment (the losses incurred are negative), such as dividend income, bond interest income and profits from joint ventures with other units. Fair value change income is the income of assets or liabilities formed by changes in fair value, which is an internal income.

2. The nature of the income is different

Fair value change gains and losses are aimed at those assets measured at fair value, mainly including trading financial assets (such as **, bonds, **, **, etc.), investment real estate, derivative financial assets, financial liabilities four categories. Investment income is when the investment asset**, the real profit or loss will be reflected in the investment income.

3. Different accounting treatments:

Under the new accounting standards, when an enterprise makes provision for "bad debts, inventory depreciation and held-to-maturity investment", the provision for bad debts and inventory depreciation are debited as "asset impairment loss" and credited as "bad debt provision and inventory depreciation provision".

It can be understood as an "administrative expense" (but not an administrative expense), and the balance of the "Asset Impairment Loss" account is transferred to the "Profit for the Year" account at the end of the month.

The investment income accounting enterprise shall carry out detailed accounting according to the investment project according to the investment income or investment loss recognized by the enterprise according to the long-term equity investment standard, and the balance of this account shall be transferred to the "current year's profit" account at the end of the period, and there should be no balance after the carry-over of this account.

Encyclopedia - Investment income.

Encyclopedia - Fair Value Change Income.

The difference between fair value change income and investment income: "fair value change income" is an account of "trading financial assets measured at fair value through profit or loss". Investment income is the net income from profits, dividends and bond interest obtained from foreign investment, minus investment losses.

Strictly speaking, the so-called investment income refers to the monetary income with the project as the boundary.

Fair Value Change Income" is an account of "trading financial assets measured at fair value through profit or loss". At the balance sheet date, the difference between the fair value of a "trading financial asset" and its carrying amount shall be debited and the "fair value change of fair value of a trading financial asset" shall be credited, and the difference between the fair value and the carrying amount shall be reversed. You can also understand "fair value change profit or loss" in the same way that you understand "investment income".

1. The difference between the change in the value of the public charge and the investment income: the change in the value of the public charge is the appreciation of the assets caused by the change of the market, and the latter is the income of various forms of external investment that is higher than the interest of the bank in the same period. They include earnings on various assets.

2. The profit or loss of trading financial assets belongs to the profit and loss account.

Shouldn't it be lowered by 50; Fair value change gain or loss", then the investment income should be 200: 50 fair value change profit or loss

By the way; To put it more simply. (The reason for this?) Those changes don't count at the end).

Originally counted", sold was 1200, now it is 250; = 50 debits, so there should no longer be any fair value change gains or losses in the income statement: investment income.

There is such a rule that there is no such thing as a loan, you seem to be the opposite, and all the profits and losses are reflected in the investment income, and the cost of buying this financial asset is 1000. So an adjustment entry should be made at the end.

Debit: The part originally included in the fair value change gain or loss is recognized as investment income when the transaction financial asset is disposed of.

Gains or losses on changes in fair value are not converted into investment income.

Accounting for Transactional Financial Assets:

Initial acquisition. Borrow: Trading Financial Assets – Costs (Fair Value), Dividends Receivable (Cash Dividends Declared but Not Paid), Interest Receivable (Interest on Bonds Whose Interest Payment Period Has Expired but Not Yet Received), Investment Income (Transaction Costs), Tax Payable – VAT Payable (Input Tax) (Deductible VAT on Transaction Costs), Credit:

When the fair value of other monetary funds (the total price paid) is greater than the book value in subsequent measurements

Debit: Trading Financial Assets - Changes in Fair Value, Credit: Gains or Losses on Changes in Fair Value, When the Fair Value is Less Than the Book Value:

Borrow: Gains or losses on changes in fair value, Credit: Trading financial assets - Changes in fair value, when cash dividends or interest accrued at maturity are declared, Borrow: dividends receivable or interest receivable), Credit: investment income, when cash dividends or interest are received:

Borrow: other monetary funds, etc., Credit: Dividends receivable (or interest receivable), ** of trading financial assets, Borrow:

Other monetary funds, etc. (net selling price actually received), credit: trading financial assets - cost, trading financial assets - change in fair value (or debit), investment income (balance squeezing, loss debited, gain credited), tax payable - VAT payable on transferred financial products.

The difference between fair value change gains and losses and other comprehensive income is the impact on profits.

Fair value change loss refers to the profit or loss caused by the fair value change of the company's invested assets or liabilities at the end of the period and the beginning of the accounting statement, while other comprehensive income includes some non-recurring and non-operating gains and losses.

For example, foreign currency translation differences, unrealized investment gains, etc. Gains and losses on changes in fair value will be directly included in the income statement for the current period, while other comprehensive income will not have a direct impact on the profit for the current period, but will be recorded in shareholders' equity in the form of accumulation, and finally presented as part of the statement of comprehensive income.

To sum up, there are obvious differences in the way fair value gains and losses and other comprehensive income are calculated, included and finally presented in accounting.

Hope mine is helpful to you!

Generally speaking, with the exception of long-term equity investments accounted for by the equity method, investment income is a realized profit or loss. The fair value change gain or loss is only a book gain or loss, not an actual profit or loss.

For example, 100 yuan to buy a **, the market price at the end of the year is 120, and the fair value change of 20 yuan is recognized, but the market price of ** in the second year drops to 90, so the 20 that rose in the first year is actually gone.

And if it is sold at 120 at the end of the first year, then the 200,000 yuan will become the actual income, and the market price ** in the second year will not be affected.

Investment income refers to the income obtained by the enterprise from foreign investment (the loss incurred is negative), such as the dividend income obtained by the enterprise from foreign investment, the interest income of bonds, and the profit shared by joint operation with other units.

Fair value change gains or losses refer to the gains or losses that should be included in the current profit or loss arising from changes in the fair value of various assets, such as investment real estate, debt restructuring, non-monetary exchange, and transactional gold and property financing.

The main difference between the two is that the return on investment is generally the income that has already been realized. The fair value change is only a price fluctuation reflected in the book, and there may not be actual realization.

Put in fair value change gain or loss. The item "Fair Value Change Profit or Loss" reflects the net income or net loss of the change in the fair value of Gongchang that the enterprise is currently recognizing, and if it is a net loss, it is filled in with a "-" sign. In general, the gain on the change in fair value of the public tolerance includes the following:

1. Gains or losses on changes in fair value of trading financial assets (such as **, bonds, **, **, etc.).

2. Gains and losses on changes in fair value of investment real estate.

3. Gains or losses on changes in the fair value of derivative financial assets.

4. Gains and losses on changes in the fair value of financial liabilities.