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question 33

Multiple Choice

[The following information applies to the questions displayed below.]
On October 12,2017,Neptune Corporation invested $700,000 in short-term available-for-sale marketable securities.The market value of this investment was $730,000 at December 31,2017,but had slipped to $725,000 by December 31,2018.
-In financial statements prepared on December 31,2017,Neptune Corporation reports:

• A)The asset Investments in Marketable Securities at $700,000 with footnote disclosure of the market value of $730,000.
• B)The asset Investments in Marketable Securities at $730,000,and a $30,000 Unrealized Holding Gain included in total stockholders' equity.
• C)The asset Investments in Marketable Securities at $730,000,and a $30,000 gain recognized in the income statement.
• D)The asset Investments in Marketable Securities at $700,000,and a $30,000 Unrealized Holding Gain included in total stockholders' equity.

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Definitions:

Charitable Contribution

Financial or material donations given to a charitable organization, often eligible for tax deductions.

C Corporation

A type of business entity that is taxed separately from its owners, and can have an unlimited number of shareholders.

Subchapter S Status

A tax designation for small corporations that meet specific IRS requirements, allowing income to be taxed at the shareholder level rather than at the corporate level.

Subchapter S Corporation

A type of corporation created through an IRS tax election to pass corporate income, losses, deductions, and credits through to shareholders for federal tax purposes.