Knowledge Check $01$

On December $1,$ Year $1,$ Childe Company purchased $$100,000$ of bonds issued by Paperman Company at face value. The bonds mature in ten years. Childe$$s intent was to keep the bonds available to sell when cash needs arise in future years. The fair value of those bonds increased to $$102,000$ on December $31,$ Year $1.$ Which of the following statements are correct with regards to this investment?

Note: Select all that apply.

Check All That Apply

The bonds should be reported among assets in the balance sheet at December $31,$ Year $1.$

The bonds should be reported among assets in the balance sheet at December $31,$ Year $1.$

The bonds should be reported at their fair value of $$102,000$ in the balance sheet.

The bonds should be reported at their fair value of $$102,000$ in the balance sheet.

An unrealized holding gain of $$2,000$ should be included in net income for Year $1.$

An unrealized holding gain of $$2,000$ should be included in net income for Year $1.$

An unrealized gain of $$2,000$ should be included in other comprehensive income for Year $1.$

An unrealized gain of $$2,000$ should be included in other comprehensive income for Year $1.$