...
The loss factor of 2,000 is processed as a quantity reduction with no impact on deferred market discount or cost as there is sufficient unamortized discount (For example, 40,000) to absorb the full loss factor.
Totals after applying loss factor After Applying Loss Factor
Units | Cost | Def Market Discount | Mkt Dis |
998,000 | 950,000 | 10,000 | 38,000 |
...
The system applies loss factor reducing the unamortized discount by 5,000 to zero and then reduces the deferred market discount by the remaining 12,000 leaving 3,000 available as deferred market discount.
Totals after processing loss factorAfter Processing Loss Factor
Units | Cost | Def Market Discount | Mkt Dis |
983,000 | 980,000 | 3,000 | 0 |
...
| Debit | Credit |
Amortization Income |
| 3,000 |
Investment Receivable | 8,000 |
|
Cost |
| 5,000 |
Totals after applying loss factor and proceedsAfter Applying Loss Factor and Proceeds
Units | Cost | Def Market Discount | Mkt Dis |
975,000 | 975,000 | 0 | 0 |
...
| Credit | |
Loss | 5,000 |
|
Cost |
| 5,000 |
Totals after After Processing Loss Factor but Prior to Applying Proceeds
...
| Credit | |
Investment Receivable | 8,000 |
|
Cost |
| 8,000 |
Totals after applying loss factor and proceedsAfter Applying Loss Factor and Proceeds
Units | Cost | Def Market Discount | Mkt Dis |
967,000 | 967,000 | 0 | 0 |
...
| Credit | |
Loss |
| 5,000 |
Cost | 5,000 |
|
Totals after processing recovery factor but prior to applying proceedsAfter Processing Recovery Factor but Prior to Applying Proceeds
Units | Cost | Def Market Discount | Mkt Dis |
977,000 | 972,000 | 5,000 | 0 |
...
| Credit | |
Investment Receivable | 25,000 |
|
Cost |
| 20,000 |
Amortization Income |
| 5,000 |
Totals after applying recovery factor and proceedsAfter Applying Recovery Factor and Proceeds
Units | Cost | Def Market Discount | Mkt Dis |
952,000 | 952,000 | 0 | 0 |
...