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Novi purchased ABC bonds on 1/1/22. Data regarding these available-for-sale securities follow:       Cost      MV December 31, 2022 $150,000 $130,000 December 31, 2023 150,000 161,000 December 31, 2024 150,000 155,000   On 1/1/25, Novi sold $40,000 (cost) of the securities for $40,100. Market Value of the remaining securities at 12/31/25 was $108,000.   The balance of the Fair Value Adjustment account included on the 12/31/25 balance sheet is: a.$2,000 debit b.$2,000 credit c.$2,100 debit d.$1,900 credit e.$1,900 debit

Novi purchased ABC bonds on 1/1/22. Data regarding these available-for-sale securities follow:       Cost      MV December 31, 2022 $150,000 $130,000 December 31, 2023 150,000 161,000 December 31, 2024 150,000 155,000   On 1/1/25, Novi sold $40,000 (cost) of the securities for $40,100. Market Value of the remaining securities at 12/31/25 was $108,000.   The balance of the Fair Value Adjustment account included on the 12/31/25 balance sheet is: a.$2,000 debit b.$2,000 credit c.$2,100 debit d.$1,900 credit e.$1,900 debit

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Novi purchased ABC bonds on 1/1/22. Data regarding these available-for-sale securities follow:

 

    Cost

     MV

December 31, 2022

$150,000

$130,000

December 31, 2023

150,000

161,000

December 31, 2024

150,000

155,000

 

On 1/1/25, Novi sold $40,000 (cost) of the securities for $40,100. Market Value of the remaining securities at 12/31/25 was $108,000.

 

The balance of the Fair Value Adjustment account included on the 12/31/25 balance sheet is:

a.$2,000 debit

b.$2,000 credit

c.$2,100 debit

d.$1,900 credit

e.$1,900 debit

 

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