Hopkins Company Regularly Invests in Securities with the Intention to Earn

question 44

Multiple Choice

Hopkins Company regularly invests in securities with the intention to earn income.As part of their investment portfolio they bought 20,000 shares of Stern Ltd.for $12.50 per share on March 1, 2014.Hopkins designated the investment as FVTPL At their year-end, December 31, 2014; the shares were trading at $15.00.They sold the shares on January 5, 2015, for $14.50 each.What is the impact of the investment in Stern Ltd.on Hopkins Company's income statement for 2015?

• A)No effect
• B)$10,000 realized loss
• C)$40,000 realized gain
• D)$40,000 unrealized gain

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Definitions:

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Compensation levels significantly above the average for comparable positions, typically reflecting high skill levels, experience, or demand.

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