Rye Company Purchased 15% of Lena Company's Common Stock During

Question 56
Multiple Choice

Rye Company purchased 15% of Lena Company's common stock during 2019 for $150,000.The Investment in Lena had a $160,000 fair value at the end of 2019 and a $140,000 fair value at the end of 2020. Which of the following statements is incorrect? A)The net $10,000 unrealized loss on the investment is reported on Rye's balance sheet as a component of other comprehensive income. B)The 2020 unrealized loss is $20,000,and is included in Rye's 2020 net income. C)The investment is reported at $140,000 on the December 31,2020 balance sheet. D)The 2019 unrealized gain is $10,000 and is included in Rye's 2019 net income.