Amacon Corporation Has the Following Investments at December 31,2016

question 33

Multiple Choice

Amacon Corporation has the following investments at December 31,2016:

Amacon,whose year-end is Sept.30,purchased the share of Daisy on January 1,2015.If Amacon irrevocably elected to classify its investment in Daisy at fair value through OCI,what amount will be reported in other comprehensive income at September 30,2016?

• A)$1,500 gain.
• B)$2,500 gain.
• C)$3,000 gain.
• D)$19,500

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Definitions:

Security Selection

The process of choosing individual securities for investment with the aim of achieving a portfolio's investment goals.

Investment Portfolio

An assortment of monetary assets, including shares, bonds, commodities, money, and near-money instruments such as mutual funds and exchange-traded funds (ETFs).

Asset Classes

Categories of assets with similar characteristics and behavior in the marketplace, such as stocks, bonds, real estate, and cash.

Securities

Assets indicating an equity share in a publicly-listed firm (stock), a lending arrangement with a corporation or government (bond), or ownership rights via options.