At the End of the First Year of Operations, the Total

question 22

Multiple Choice

At the end of the first year of operations, the total cost of the trading securities portfolio is $244,000. Total fair value is $250,000. The financial statements should show

• A) an addition to an asset of $6,000 and a realized gain of $6,000.
• B) an addition to an asset of $6,000 and an unrealized gain of $6,000 in the stockholders' equity section.
• C) an addition to an asset of $6,000 in the current assets section and an unrealized gain of $6,000 in "Other revenues and gains."
• D) an addition to an asset of $6,000 in the current assets section and a realized gain of $6,000 in "Other revenues and gains."

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Definitions:

Warm Current

A flow of warmer ocean water that moves in a defined direction and can influence the climate of nearby land areas.

Sea-Surface Temperatures

The temperature of the surface layer of the oceans, which can significantly influence weather and climate patterns.

El Niño

A condition that occurs when warmer-than-average ocean surface temperatures occur in the central and east-central Equatorial Pacific.

Eastern Pacific

A region of the Pacific Ocean located to the east of the International Date Line, typically referring to the ocean off the coasts of the Americas.