PM Distributors Began Year 2 with Equity Investments of $8,100

question 41

Multiple Choice

PM Distributors began Year 2 with Equity Investments of $8,100 (which consisted of a single investment) as well as a debit balance of $1,000 in the Fair Value Adjustment - Equity Investments account. PM does not have significant influence over the investee, and the investment has a readily determinable fair value. This trading security was sold for $9,100 during Year 2. How much was the gain or loss for the sale of this investments and how is it recorded?

• A) No gain or loss reported, as the investment was sold for the adjusted fair value
• B) Unrealized Gain of $1,000, reported as part of Other Comprehensive Income
• C) Realized Loss of $1,000, reported as part of Net Income
• D) Realized Gain of $1,000, reported as part of Net Income

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Definitions:

Intergroup Conflict

Intergroup conflict occurs among groups in an organization.

Different Teams

Groups composed of individuals who bring diverse skills, perspectives, and roles to work towards a common goal or project.

Intragroup Conflict

Disagreements or disputes occurring within a single group or team, often related to task assignments, goals, or interpersonal relationships.

Functional Departments

are specialized units within an organization, such as marketing or finance, each focused on a specific area of operation contributing to the organization’s goals.