Question1: At the end of its 1st year, the trading securities portfolio consisted of the following common stocks.
The unrealized loss to be recognized under the fair value method is
Cost Market
Able Corporation $46,400 $50,000
Baker Inc. 60,000 53,800
Cole Corporation 80,000 76,000
$186,400 $179,800
[A] $10,200
[B] $6,600
[C] $6,200
[D] $4,000
Question2: Tolan Co. purchased 60, 6 percent Irick Company bonds for $60,000 cash plus brokerage fees of $600. Interest is payable semiannually on July 1 and January 1. If 15 of the securities are sold on July 1 for $31,000 less $300 brokerage fee, the entry would include a credit to Gain on Sale of Debt Investments for
[A] $1,300
[B] $400
[C] $1,000
[D] $700