Question 1 (Mandatory) (2.5 points)

Stocks categorized as trading securities are purchased for $55,000 during Year 1. The company only closes its books once a year, on 12/31. On December 31^st of Year 1 the market value of the stock is $67,000.

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Please provide the adjusting entry relating to these trading securities on 12/31:

Question 1 options:

	Dr. Valuation Allowance for Trading Securities $67,000 Cr. Unrealized Gain on Trading Investments $67,000
	Dr. Unrealized Gain on Trading Securities $12,000 Cr. Valuation Allowance for Trading Investments $12,000
	Dr. Unrealized Gain on Trading Securities $67,000 Cr. Valuation Allowance for Trading Investments $67,000
	Dr. Valuation Allowance for Trading Securities $12,000 Cr. Unrealized Gain on Trading Investments $12,000

Question 2 (Mandatory) (2.5 points)

Stocks categorized as trading securities are purchased for $55,000 during Year 1. The company only closes its books once a year, on 12/31. On December 31^st of Year 1 the market value of the stock is $67,000.

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On the companys 12/31 Balance Sheet, "Trading investments (at cost)" will be reported as what value?

Question 2 options:

	$67,000
	$55,000
	$12,000
	$43,000

Question 3 (Mandatory) (2.5 points)

Stocks categorized as trading securities are purchased for $55,000 during Year 1. The company only closes its books once a year, on 12/31. On December 31^st of Year 1 the market value of the stock is $67,000.

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Which of the following is true about the account "Valuation allowance for trading securities?"

Question 3 options:

	There is no "Valuation allowance for trading securities" on the Balance Sheet because the "Valuation allowance for trading securities" belongs on the Income Statement.
	The December 31st " Valuation allowance for trading securities" credit balance of $12,000 is subtracted from the account "Trading securities (at cost)" on the December 31st Balance Sheet.
	The December 31st " Valuation allowance for trading securities" debit balance of $67,000 is added to the account "Trading securities (at cost)" on the December 31st Balance Sheet.
	The December 31st " Valuation allowance for trading securities" debit balance of $12,000 is added to the account "Trading securities (at cost)" on the December 31st Balance Sheet.

Question 4 (Mandatory) (2.5 points)

Stocks categorized as trading securities are purchased for $55,000 during Year 1. The company only closes its books once a year, on 12/31. On December 31^st of Year 1 the market value of the stock is $67,000.

_______________________________________________________________

On the companys 12/31 Balance Sheet, "Trading investments (at fair value)" will be reported as what value?

Question 4 options:

	$12,000
	$43,000
	$67,000
	$55,000