A Company Had Investments in Long-Term Available-For-Sale Securities B) C)

question 146

Multiple Choice

A company had investments in long-term available-for-sale securities.At the end of the current year,the company's portfolio had a $731,000 cost and $730,000 market value.
What is the current year's adjustment to market value given the following account balances at the end of the prior year?

• A) \[\begin{array} { | c | l | l | } \hline \text { Market Adjustment - Available-for-Sale } \ldots \ldots \ldots \ldots \ldots & 1,000 & \\ \hline \text { Ururealized Gain Equity } \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots & & 1,000 \\ \hline \end{array}\]
• B) \[\begin{array} { | c | l | l | } \hline \text { Market Adjustment - Available-for-Sale } \ldots \ldots \ldots \ldots \ldots &6 , 0 0 0 & \\ \hline \text { Ururealized Gain Equity } \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots & & 6 , 000 \\ \hline \end{array}\]
• C) \[\begin{array} { | l | l | l |} \hline \text { Ururealized Gain Equity } \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots & 1,000 \\ \hline\quad \text { Market Adjustment - Available-for-Sale } \ldots \ldots \ldots \ldots \ldots && 1,000 \\ \hline \end{array}\]
• D) \[\begin{array} { | l | l | l |} \hline \text {Ururealized Gain (Loss)}\\ \text{Equity } \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots & 6,000 \\ \hline\quad \text { Market Adjustment - Available-for-Sale } \ldots \ldots \ldots \ldots \ldots && 6,000 \\ \hline \end{array}\]
• E) \[\begin{array} { | c | l | l | } \hline \text { Uryealized Gain (Loss) Equity } \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots \ldots & 4,000 & \\ \hline \text { Market Adjustment - Available-for-Sale } \ldots \ldots \ldots \ldots & & 4,000 \\ \hline \end{array}\]

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Definitions:

Competitive Analysis

A process of evaluating the strengths and weaknesses of competitors in the market to identify opportunities and threats.

Golden Parachutes

Golden parachutes are sizable benefits guaranteed to company executives if they are removed from their position or the company is taken over.

Severance Packages

Financial compensation provided to employees upon termination of employment, generally based on factors like length of service and position level.

Termination Benefits

Payments and services provided to employees upon their leaving the company, which may include severance pay, continued health insurance, and other perks.