Nguyen Inc. began business on January 1, 2012, and at December 31, 2012, Nguyen had the following investment portfolios of equity securities: Unrealized losses at December 31, 2012, should be recorded with corresponding charges against Income and Stockholders' Equity of

Question

Nguyen Inc. began business on January 1, 2012, and at December 31, 2012, Nguyen had the following investment portfolios of equity securities:  Unrealized losses at December 31, 2012, should be recorded with corresponding charges against Income and Stockholders' Equity of

Quizplus · Accepted Answer

The total unrealized losses on the portfolio at December 31, 2012, is $70,000 ($20,000 + $50,000), which is recorded as a charge against income (realized gains and losses) of $40,000 and against Stockholders' Equity (unrealized gains and losses) of $30,000. Therefore, the correct choice is B, $40,000 and $30,000, respectively.