S&L Financial buys and sells securities that it typically classifies as available-for-sale. On December 27, 2018,S&L purchased Coca-Cola bonds at par for $875,000 and sold the bonds on January 3, 2019, for $880,000. AtDecember 31, the bonds had a fair value of $873,000. When it purchased the Coca-Cola bonds, S&L Financialdecided to elect the fair value option for this investment. What pretax amounts did S&L include in its 2018 and2019 net income as a result of this investment (ignoring interest)?
S&L Financial buys and sells securities that it typically classifies as available-for-sale. On December 27, 2018,S&L purchased Coca-Cola bonds at par for $875,000 and sold the bonds on January 3, 2019, for $880,000. AtDecember 31, the bonds had a fair value of $873,000. When it purchased the Coca-Cola bonds, S&L Financialdecided to elect the fair value option for this investment. What pretax amounts did S&L include in its 2018 and2019 net income as a result of this investment (ignoring interest)?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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S&L Financial buys and sells securities that it typically classifies as available-for-sale. On December 27, 2018,
S&L purchased Coca-Cola bonds at par for $875,000 and sold the bonds on January 3, 2019, for $880,000. At
December 31, the bonds had a fair value of $873,000. When it purchased the Coca-Cola bonds, S&L Financial
decided to elect the fair value option for this investment. What pretax amounts did S&L include in its 2018 and
2019 net income as a result of this investment (ignoring interest)?
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