On December 30,2015,Varsity Corporation sold available for sale marketable securities costing $800,000 for $860,000 cash.The securities were purchased on January 2,2013 and the market value of the securities on December 31,2013 and December 31,2014 was $820,000 and $780,000,respectively.How much gain or loss will Varsity report in its income statement for the year ending December 31,2015?

Question

Quizplus · Accepted Answer

Varsity Corporation will report a $60,000 gain in its income statement for 2015, calculated as the difference between the selling price ($860,000) and the original cost ($800,000) of the securities.

On December 30,2015,Varsity Corporation Sold Available for Sale Marketable Securities