All of the following statements about financial

161. All of the following statements about financial statement gains and losses on investments
are true except
a. the account "Fair Value Adjustment – Available-For-Sale" is reported on the balance
sheet.
b. unrealized losses on trading securities are reported on the income statement.
c. unrealized losses on available-for-sale securities are reported on the income
statement.
d. the account "Fair Value Adjustment – Trading" is reported on the balance sheet.
Ans: C, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:
Reporting
H-38
162. Baggles Company owns stock in Hampshire Industries, which it intends to hold
indefinitely because of some negative tax consequences if sold. Which of the following
statements is true regarding Baggles’ reporting of the stock?
Reporting
FOR INSTRUCTOR USE ONLY

Reporting and Analyzing Investments
163. All of the following statements about short-term investments are true except
Reporting
164. Short-term investments are listed on the balance sheet immediately below