Question 23 The following data pertains to Traverse Co s inv

Question 23 The following data pertains to Traverse Co s investments in marketable equity securities: Not yet answered Points out of 3.00 Market value 12131/18 12131/19 155,000 100,000 Trading Available-for-sale 150,000 130,000 120,000 P Flag question What amount should Traverse Co report as unrealized holding loss to be included in 2019 Net Income? Select one: O a $50,000 O b. $55,000 O c. $60,000 ? d $10,000 O e. $80,000

Solution

Answer)

My answer is option (a).

Marketable securities must be shown only lower of market value or cost and hence, trading securities get decreased by $50000. While available to sale value declined will not be shown in income statement but in other comprehensive income.