Infografix Corporation's consolidated sales for 2017 were $26.6 million and expenses totaled $24.8 million. Infografix operates worldwide and conducts 37% of its business outside Canada. During 2014, Infografix reported the following items in its financial statements (amounts in millions):
Unrealized holding on non-strategic investments........................................................ (328)
As you consider an investment in Infografix shares, some concerns arise. Answer the following questions:
1. What do the parentheses around the dollar amounts signify?
2. Is this item reported as an asset, liability, shareholders' equity, revenue, or expense? Are they normal-balance accounts, or are they contra accounts?
3. Is this item reason for rejoicing or sorrow at Infografix? Are Infografix's emotions about this item deep or only moderate? Why?
4. Did Infografix include this item in net income? Did it include this item in retained earnings?
In the final analysis, how much net income did Infografix report for 2017?
5. Should these items scare you away from investing in Infografix shares? Why or why not?