Question: Knowledge Check 0 1 On December 1 , Year 1 , Axel Financial purchased $ 5 0 , 0 0 0 of bonds issued by

Knowledge Check 01
On December 1, Year 1, Axel Financial purchased $50,000 of bonds issued by Lamb Company at face value. The bonds mature in ten years. Axel's intent was to sell the bonds soon to earn a profit on any short-term price fluctuations. The fair value of those bonds decreased by $5,000 to $45,000 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 current assets in the balance sheet at December 31, Year 1.
At December 31, Year 1, the $5,000 decrease in fair value should be ignored.
The bonds should be reported at their fair value of $45,000 in the balance sheet at December 31, Year 1.
Knowledge Check 0 1 On December 1 , Year 1 , Axel

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