Yankton Company Began the Year Without an Investment Portfolio

question 88

Multiple Choice

Yankton Company began the year without an investment portfolio. During the year, it purchased investments classified as trading securities at a cost of $13,000. At the end of the year, the market value of the securities was $11,000. Yankton Company's financial statements for the current year should show

• A) an unrealized loss of $2,000 on the income statement and net trading securities of $13,000 on the balance sheet
• B) no unrealized loss on the income statement and net trading securities of $13,000 on the balance sheet
• C) no unrealized loss on the income statement; net trading securities of $11,000 and an unrealized loss of $2,000 as a stockholders' equity adjustment on the balance sheet
• D) an unrealized loss of $2,000 on the income statement and temporary investments of $11,000 on the balance sheet

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Definitions:

Test-Retest

A method of assessing the reliability of a test by administering the same test to the same subjects at two different points in time and comparing the scores.

Internal Consistency

A measure of the reliability of a test or scale, assessed by the degree of interrelation among items within the test.

Internal Consistency

A measure of the reliability of a psychological test or assessment, indicating how well the items on the test measure the same concept or construct.

Spearman-Brown

A formula used in psychometrics to estimate the reliability of a test, particularly in relation to the length of the test.