A Company Failed to Record Unrealized Gains of $20 Million

question 85

Multiple Choice

A company failed to record unrealized gains of $20 million on its available for sale security investments. Its tax rate is 30%. As a result of this error, comprehensive income would be:

• A)Understated by $14 million.
• B)Understated by $6 million.
• C)Understated by $20 million
• D)UnaffecteD.Unrealized gains on securities available for sale are reported net of tax in other comprehensive income.

---

Definitions:

Stylistic Crosscurrents

The intersection, influence, and interplay of various artistic styles within a particular work or among different works, leading to the evolution of new styles or movements.

Krishna and Radha

Central figures in Hinduism, representing the divine love between the god Krishna and his devotee Radha.

Pavilion

A light, sometimes temporary, structure used in gardens, parks, and fairs for entertainment or shelter, often elaborately designed.

Lovers' Tryst

A secretly arranged meeting between lovers, often characterized by a romantic or intimate nature.