Problem: On its December 31, 2007 balance sheet, Klugman Company appropriately reported a $10,000 debit balance in its Securities Fair Value Adjustment (Available-for-Sale) account. There was no change during 2008 in the composition of Klugman's portfolio of marketable equity securities held as available-for-sale securities. The following information pertains to that portfolio:
|
Securi
|
Cost
|
Fair value at 12/31/08
|
|
X
|
$125,000
|
$160,000
|
|
Y
|
100,000
|
95,000
|
|
Z
|
175,000
|
125,000
|
|
|
$400.000
|
$380,000
|
Q1. What amount of unrealized loss on these securities should be included in Klugman's stockholders' equity section of the balance sheet at December 31, 2008?
A) $30,000.
B) $20,000.
C) $10,000.
D) $0.
Q2. The amount of unrealized loss to appear as a component of comprehensive income for the year ending December 31, 2008 is
A) $30,000.
B) $20,000.
C) $10,000.
D) $0.