When a Firm Sells a Trading Security,it Recognizes

question 33

Multiple Choice

When a firm sells a trading security,it recognizes:

• A) the average of the selling price and the book value as a gain or loss in measuring net income.
• B) the difference between the selling price and the book value as a gain or loss in measuring net income.
• C) amortizes any difference between the acquisition cost and maturity value as interest revenue over the life of the debt.
• D) the difference between the selling price and the acquisition cost of the security as a realized gain or loss on the income statement.

---

Definitions:

Ignition Key

A key used to activate the ignition system of a vehicle, enabling the engine to start.

Mirror Neurons

Neurons that fire both when an individual acts and when the individual observes the same action performed by another, thought to be involved in processes such as learning by imitation.

Imitation

The action of using someone or something as a model and attempting to replicate their behavior, actions, or characteristics.

Observational Learning

Learning that occurs by watching the actions and outcomes of others' behaviors, without direct experience.