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Unrealized gains or losses on available for sale

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153.Unrealized gains or losses on available-for-sale securities are reported where in thefinancial statements?a.Nowhere since only realized gains are reported.b.In the “Other revenues and gains” or “Other expenses and losses” sections of theincome statement.c.Below unusual items in the income statement.d.In the stockholders’ equity section of the balance sheet.Ans: D, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:ReportingH-35
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Test Bank for Financial Accounting: Tools for Business Decision Making, Eighth Edition154.At the end of its first year, the securities portfolio consisted of the following commonstocks, all of which represent less than 20% ownership.CostFair valueDraper Corporation$46,400$50,000Edmunds Inc.60,00055,800Feazell Corporation80,00076,000$186,400$181,800The unrealized loss to be recognized under the fair value method is
155.At the end of its first year, the securities portfolio consisted of the following commonstocks, all of which represent les then 20% ownership.CostFair ValueDraper Corporation$46,400$50,000Edmunds Inc.60,00055,800Feazell Corporation80,00076,000$186,400$181,800In the following year, the Edmunds common stock is sold for cash proceeds of $57,000.The gain or loss to be recognized on the sale is a
156.At the end of the first year of operations, the total cost of the trading securities portfolio is$245,000. Total fair value is $250,000. The financial statements should show

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