29. A) Not reported until recognized B) Reported on the income statement C) Repo

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29. A) Not reported until recognized B) Reported on the income statement C) Reported as an unearned revenue on the balance shout D) Reported in the stockholders' equity section of the balance shees Use the following to answer questions 30-31 On October 12, 2006, Livingston Corporation invested S500.000 in short-term marketable securities. The market value of this investment was $530,000 at ece but had slipped to $525,000 by December 31, 2007 31, 2006. 30. Refer to the above data. In financial statements prepared on December 31, 2006, Livingston Corporation reports: A) The asset Investments in Marketable Securities at $500,000 with of the market value of $530,000. B) The asset Investments in Marketable Securities at $530,000, and a $30,000 Unrealized Holding Gain included in total stockholders' equity C) The asset Investments in Marketable Securities at $530,000, and a $30,000 gain recognized in the income statement. D) The asset Investments in Marketable Securities at $500,000, and a $30,000 Unrealized Holding Gain included in total stockholders' equity 31. Assuming Livingston does not sell this investment, financial Refer to the above data. statements prepared at December 31, 2007, report A) Investments in Marketable Securities of $500,000, reduced by a $30,000 Unrealized B) The asset Investments in Marketable Securities of $500,000 in the balance sheet, and C) The asset Investments in Marketable Securities of $525,000, and a $5,000 Unrealized D) Investment in Marketable Securities of $525,000 in the asset section of the balance Holding Gain on Investments, in the asset section of the balance sheet. a $25,000 Unrealized Holding Loss on Investments in the income statement Holding Loss deducted from total stockholders' equity sheet, with a $25,000 Unrealized Holding Gain on Investments included in the stockholders' equity section. 2. An asset which costs $7,200 and has accumulated depreciation of $1,800 is sold for $4,500. What amount will be recognized when the asset is sold? A) A gain of $900 B) A loss of $900 C) A loss of $2,700 D) A gain of $2,700 33. Coca-Cola's famous name printed in distinctive typeface is an example of. A) A trademark. B) A patent. C) A copyright. D) Goodwill

Explanation / Answer

Answer 29 -D. Reported to stockholders' equity section of the Balance Sheet Unrealized holding gains and losses on available-for-sale securities are accumulated in the shareholders’ equity section of the balance sheet. Specifically, the account is included in Accumulated Other Comprehensive Income Answer 30-B. The asset Investment in Marketable Securities at $530,000 and a $30,000 Unrealized Holding Gain included in total stockholders' equity. Cost Market Value Difference Available for Sale Investment    500,000.00           530,000.00       30,000.00 Answer 31-D. Investment on Marketable Securities of $525,000 in the asset section of the balance sheet, with a $25,000 Unrealized Holding Gain on Investments included in the stockholders' equity section. Cost Market Value Difference Available for Sale Investment    500,000.00           525,000.00       25,000.00 Less: Unrealized Gain (Loss) - b/f       30,000.00 Fair Value Adjustment       (5,000.00) Answer 32-B. A loss of $900 Cost of asset        7,200.00 Accumulated Depreciation      (1,800.00) Book Value of Asset        5,400.00 Sale Price of Asset        4,500.00 Book Value of Asset        5,400.00 Loss on sale of Asset          (900.00) Answer 33-A. Trademark

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