What is the key difference in accounting treatment between unrealized and realized gains or losses for AFS securities?

• A. Unrealized gains or losses affect other comprehensive income, while realized gains or losses affect net income.
• B. Unrealized gains or losses are reported as liabilities, while realized gains or losses are reported as assets.
• C. Unrealized gains or losses affect net income, while realized gains or losses affect other comprehensive income.
• D. Both unrealized and realized gains or losses affect retained earnings.

Answer: (A)