Foley Corporation's Trading Portfolio at the End of the Year

question 136

Multiple Choice

Foley Corporation's trading portfolio at the end of the year is as follows: At the end of the year, Foley Corporation should

• A) set up a Market Adjustment account for Stock B.
• B) set up a Market Adjustment account for the portfolio.
• C) recognize an Unrealized Gain or Loss-Income for $3,000.
• D) report a loss on the income statement for $3,000 under "Other Expenses and Losses."

---

Definitions:

Liable

Legally responsible or obligated to make restitution or compensation for harm or breach.

Chief Financial Officer

A senior executive responsible for managing the financial actions of a company, including financial planning and record-keeping, as well as financial reporting to higher management.

Accommodation Party

A person who signs a negotiable instrument for the purpose of adding his name and liability to another party to the instrument.

Lend Money

The action of giving money to someone with the expectation that it will be paid back in the future, possibly with interest.