Goofy Incorporated bought a sizeable amount of Crazy Company's bonds for $200,000 on May 5, 2023, and classified the investment as available-for-sale. The market value of the bonds declined to $124,000 by December 31, 2023. Goofy reclassified this investment as trading securities in December of 2024 when the market value had risen to $163,000. What effect on 2024 net income should be reported by Goofy for the Crazy Company bonds? A: 39,000 net unrealized holding gain B: 37,000 net unrealized holding loss C: 76,000 net unrealized holding loss D: 0

Chemistry for Engineering Students
4th Edition
ISBN:9781337398909
Author:Lawrence S. Brown, Tom Holme
Publisher:Lawrence S. Brown, Tom Holme
Chapter10: Entropy And The Second Law Of Thermodynamics
Section: Chapter Questions
Problem 10.5PAE
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Goofy Incorporated bought a sizeable amount of Crazy Company's bonds for
$200,000 on May 5, 2023, and classified the investment as available-for-sale. The
market value of the bonds declined to $124,000 by December 31, 2023. Goofy
reclassified this investment as trading securities in December of 2024 when the
market value had risen to $163,000. What effect on 2024 net income should be
reported by Goofy for the Crazy Company bonds?
A: 39,000 net unrealized holding gain
B: 37,000 net unrealized holding loss
C: 76,000 net unrealized holding loss
D: 0
Transcribed Image Text:Goofy Incorporated bought a sizeable amount of Crazy Company's bonds for $200,000 on May 5, 2023, and classified the investment as available-for-sale. The market value of the bonds declined to $124,000 by December 31, 2023. Goofy reclassified this investment as trading securities in December of 2024 when the market value had risen to $163,000. What effect on 2024 net income should be reported by Goofy for the Crazy Company bonds? A: 39,000 net unrealized holding gain B: 37,000 net unrealized holding loss C: 76,000 net unrealized holding loss D: 0
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