Seybert Systems accounts for its investment in Wang Engineering as available for sale. Seybert's balance in accumulated other comprehensive income with respect to the Wang investment is a credit balance of $20,000, and Seybert reports the investment at $100,000 on its balance sheet. Seybert purchased the Wang investment for (ignore taxes):
A) $100,000.
B) $120,000.
C) $80,000.
D) Cannot be determined from this information.

Question

Quizplus · Accepted Answer

Fair value = $100,000 less unrealized holding gain of $20,000 = cost of $80,000.

Seybert Systems Accounts for Its Investment in Wang Engineering as Available