Goofy Inc. bought 15,000 shares of Crazy Co.'s stock for $206,000 on May 5, 2012, and classified the stock as available for sale. The market value of the stock declined to $118,000 by December 31, 2012. Goofy reclassified this investment as trading securities in December of 2013 when the market value had risen to $162,000. What effect on 2013 income should be reported by Goofy for the Crazy Co. shares?

Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
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Hi expert please give me answer general accounting

Goofy Inc. bought 15,000 shares of Crazy Co.'s stock for $206,000
on May 5, 2012, and classified the stock as available for sale. The
market value of the stock declined to $118,000 by December 31,
2012. Goofy reclassified this investment as trading securities in
December of 2013 when the market value had risen to $162,000.
What effect on 2013 income should be reported by Goofy for the
Crazy Co. shares?
Transcribed Image Text:Goofy Inc. bought 15,000 shares of Crazy Co.'s stock for $206,000 on May 5, 2012, and classified the stock as available for sale. The market value of the stock declined to $118,000 by December 31, 2012. Goofy reclassified this investment as trading securities in December of 2013 when the market value had risen to $162,000. What effect on 2013 income should be reported by Goofy for the Crazy Co. shares?
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