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