In its first year of operations, Rodolfo Company - 14641

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Request Description

 

In its first year of operations, Rodolfo Company purchased available-for-sale securities at a total cost of $53,000. On December 31, the end of Rodolfo's fiscal year, the fair market value of those investments totaled $57,000. As a result of these investments, Rodolfo Company will report

Answer

 

Investment in Available-for-Sale Securities of $57,000

 

Investment in Available-for-Sale Securities of $53,000

 

Unrealized Increase in Value of Available-for-Sale Securities of $4,000 on the income statement as ordinary income

 

a credit balance in the contra account to Investment in Available-for-Sale Securities of $4,000

Solution Description

 

In its first year of operations, Rodolfo Company purchased available-for-sale securities at a total cost of $53,000. On December 31, the end of Rodolfo's fiscal year, the fair market value of those investments totaled $57,000. As a result of these investments, Rodolfo Company will report

Answer