Use the following information for questions $2-6.$

ABC purchased the following available$-$for$-$sale debt securities at face value at the beginning of $2018$:

Description Cost FMV $12/31/18$ FMV $12/31/19$ FMV $12/31/20$

$5-$yr$.,5\%$ bonds $$ X Corp. $$500,000$ $$490,000$ $$515,000$ $$505,000$

$10-$yr$.,6\%$ bonds $$ Y Corp. $$1,000,000$ $$1,018,000$ $$1,025,000$ $$1,020,000$

$15-$yr$.,6\mathrm{.}5\%$ bonds $$ Z Corp. $$2,000,000$ $$1,980,000$ $$1,975,000$ $$1,960,000$

$2.$ Assuming the securities were purchased for cash, which section of the statement of cash flows should

report the cash outflow at the beginning of $2018?$

A$.$ Operating

B$.$ Investing

C$.$ Financing

D$.$ Both A and B

E$.$ None of the above

$3.$Determine the unrealized holding gain $($loss$)$ to be reported in other comprehensive income in $2018.$

A$.$ $$0$

B$.($$$12,000)$

C$.$ $$12,000$

D$.($$$30,000)$

E$.$ $$18,000$

F$.$ $$215,000$

G$.$ $$2,588,000$

$4.$ Determine the balance in the accumulated other comprehensive income account at the end of $2019.$

A$.$ $$0$

B$.$ $$12,000$ CR

C$.$ $$15,000$ CR

D$.$ $$27,000$ CR

E$.$ $$39,000$ CR

F$.$ $$12,000$ DR

G$.$ $$27,000$ DR