Investment as securities available for sale

Reference no: EM13147382

Dorchester Corporation purchased one thousand shares of Winchester Corporation stock in 2006 for $800 per share and classified the investment as securities available for sale. Winchester's market value was $400 per share on December 31, 2007, and $300 on December 31, 2008. During 2009, Dorchester sold all of its Winchester stock at $350 per share. On its 2009 income statement, Dorchester would report:

A. A realized gain of $50,000.

B. A recognition of unrealized losses of $400,000.

C. A loss on the sale of investments of $450,000.

D. A trading gain of $50,000 and an unrealized loss of $500,000.

E. None of the above is correct.

Reference no: EM13147382

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