On Its December 31, 20X1, Statement of fiNancial Position, Lumilite

question 66

Multiple Choice

On its December 31, 20X1, statement of financial position, Lumilite Co. reported its temporary investment in equity securities, under the fair value through net income method at $330,000. At December 31, 20X2, the fair value of the securities was $350,000. What should Lumilite report on its 20X2 statement of earnings because of the increase in fair value of the investments in 20X2?

• A) $0
• B) Unrealized gain of $20,000
• C) Loss on investments of $10,000
• D) Investment income of $20,000

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Definitions:

Self-Actualization

A concept in humanistic psychology representing the process by which individuals realize their full potential and capabilities.

Parenting Practices

Specific behaviors that parents use to socialize and interact with their children, directly impacting the child's development.

Defense Mechanism

Psychological strategies used unconsciously by individuals to protect themselves from anxiety and internal conflicts.

Displacement

In psychology, a defense mechanism where an individual redirects emotional impulses from a real object to a safer substitute target.