Problem on financial statements for the current year


Yankton Company began the year without an investment portfolio. During the year they 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. The Yankton Company's financial statements for the current year should show

a. a loss of $2,000 on the income statement and net trading securities of $13,000 on the balance sheet

b. no loss on the income statement and net trading securities of $13,000 on the balance sheet

c. a loss of $2,000 on the income statement and temporary investments of $11,000 on the balance sheet

d. no 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

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Accounting Basics: Problem on financial statements for the current year
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