1) Yankton Company began the year without an investment portfolio. During the year they purchased investments classified as trading securities at a cost of $13,000. At the end of the year, the market value of the securities was $11,000. The Yankton Company's financial statements for the current year should show
a. a loss of $2,000 on the income statement and temporary investments of $11,000 on the balance sheet
b. no loss on the income statement and net trading securities of $13,000 on the balance sheet
c. a loss of $2,000 on the income statement and net trading securities of $13,000 on the balance sheet
d. no loss on the income statement, net trading securities of $11,000 and an unrealized loss of $2,000 as a stockholders' equity adjustment on the balance sheet
2) The account Unrealized Gain (Loss) on Available-For-Sale Securities should be included in the
a. Statement of Retained Earnings
b. Balance sheet as an adjustment to the asset account
c. Balance sheet as an adjustment to Stockholders' Equity
d. Income statement as Other Revenue (Expenses)
3)When management seeks to achieve personal departmental objectives that may work to the detriment of the entire company, the manager is experiencing:
a. goal conflict
b. cushions
c. padding
d. budgetary slack
4) The account Unrealized Gain (Loss) on Trading Securities should be included in the
a. Statement of Retained Earnings
b. Balance sheet as an adjustment to Stockholders' Equity
c. Balance sheet as an adjustment to the asset account
d. Income statement as Other Revenue (Expenses)
5) When a bond is purchased for an investment, the purchase price, minus the brokerage commission, plus any accrued interest is recorded.
a. true
b. false