A not-for-profit hospital purchased an equity security for $150,000 on September,2012.When it prepared its 2012 financial statements,the security had a fair value of $145,000.It sold the security for $160,000 in 2013.What was the net effect of the sale of the security on the hospital's net assets in the year 2013?

Question

Quizplus · Accepted Answer

The net effect on the hospital's net assets is the difference between the sale price and the fair value at the end of 2012. The security was sold for $160,000, and its fair value at the end of 2012 was $145,000, resulting in a $15,000 increase in net assets.

A Not-For-Profit Hospital Purchased an Equity Security for $150,000 on September,2012.When