FAIR VALUE OF FINANCIAL INSTRUMENTS |
4. FAIR VALUE OF FINANCIAL INSTRUMENTS ASC 820, “Fair Value Measurements”, defines fair value, establishes a framework for measuring fair value and requires additional disclosures regarding certain fair value measurements. ASC 820 establishes a three-tier hierarchy for measuring fair value, as follows: | ● | Level 1 – quoted market prices in active markets for identical assets and liabilities |
| ● | Level 2 – inputs other than quoted prices that are directly or indirectly observable |
| ● | Level 3 - unobservable inputs where there is little or no market activity |
The following tables summarize the values of assets designated as Investments in debt and equity securities: | | | | | | | | | | | | | | | December 31, 2022 | | | Level 1 | | Level 2 | | Level 3 | | Total | Equity securities | | $ | 27,692,459 | | $ | — | | $ | — | | $ | 27,692,459 | Mutual funds | | | 1,302,973 | | | — | | | — | | | 1,302,973 | Municipal bonds | | | 661,882 | | | — | | | — | | | 661,882 | | | $ | 29,657,314 | | $ | — | | $ | — | | $ | 29,657,314 |
| | | | | | | | | | | | | | | December 31, 2021 | | | Level 1 | | Level 2 | | Level 3 | | Total | Equity securities | | $ | 9,112,607 | | $ | — | | $ | — | | $ | 9,112,607 | Mutual funds and exchange traded funds | | | 4,156,379 | | | — | | | — | | | 4,156,379 | | | $ | 13,268,986 | | $ | — | | $ | — | | $ | 13,268,986 |
These assets are readily marketable and are carried at fair value as of the date of the Balance Sheets. The Company intends to hold these assets for possible future operating requirements. The following table summarizes gross unrealized gains and losses from Investments in debt and equity securities: | | | | | | | | | | | | | | | December 31, 2022 | | | | | | Cumulative Unrealized | | Aggregate | | | Cost | | Gains | | Losses | | Fair Value | Equity securities | | $ | 22,913,739 | | $ | 4,778,720 | | $ | — | | $ | 27,692,459 | Mutual funds | | | 1,252,804 | | | 50,169 | | | — | | | 1,302,973 | Municipal bonds | | | 634,455 | | | 27,427 | | | — | | | 661,882 | | | $ | 24,800,998 | | $ | 4,856,316 | | $ | — | | $ | 29,657,314 |
| | | | | | | | | | | | | | | December 31, 2021 | | | | | | Cumulative Unrealized | | Aggregate | | | Cost | | Gains | | Losses | | Fair Value | Equity securities | | $ | 6,729,245 | | $ | 2,383,362 | | $ | — | | $ | 9,112,607 | Mutual funds and exchange traded funds | | | 4,018,488 | | | 137,891 | | | — | | | 4,156,379 | | | $ | 10,747,733 | | $ | 2,521,253 | | $ | — | | $ | 13,268,986 |
Unrealized gains on investments were $2,343,359; $513,529; and $1,870,010 for the years ended December 31, 2022, 2021, and 2020, respectively.
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