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McKnight Brothers Investments Securities

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Question 7

At December 31, 2009, McKnight Brothers Corp. had the following investments that were purchased during 2000, its first year of operations:
Cost Fair Value
Trading Securities:
Security A $ 700,000 $ 725,000
B 210,000 200,000
Totals $ 910,000 $ 925,000

Securities Available for Sale:
Security C $ 500,000 $ 560,000
D 850,000 865,000
Totals $1,350,000 $1,425,000

Securities to Be Held to Maturity:
Security E $ 970,000 $ 980,000
F 412,000 409,000
Totals $1,382,000 $1,389,000

No investments were sold during 2009. All securities except Security D and Security F are considered short-term investments. None of the market changes is considered permanent.

Required:

Determine the following amounts at December 31, 2009:
1. Investments reported as current assets.
2. Investments reported as noncurrent assets.
3. Unrealized gain (or loss) component of income before taxes.
4. Unrealized gain (or loss) component of other comprehensive income.

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Solution Summary

The solution determines the current assets, noncurrent, gain or loss of the McKnight Brothers Investment Securities.

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