On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $132 million and classified the securities as trading securities. On December 31, 2021, these bonds were valued at $150 million. Three months later, on April 3, 2022, Phillips Corporation sold these bonds for $140 million. As part of the multistep approach to record the 2022 transaction, Phillips Corporation should first update the fair value adjustment by recording: Multiple Choice An unrealized holding gain of $28 million in 2022. An unrealized holding loss of $10 million in 2022. An unrealized holding gain of $8 million in 2022. A gain of $8 million in 2022.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 2MC: During 2021, Anthony Company purchased debt securities as a long-term investment and classified them...
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On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $132 million and classified
the securities as trading securities. On December 31, 2021, these bonds were valued at $150 million. Three
months later, on April 3, 2022, Phillips Corporation sold these bonds for $140 million.
As part of the multistep approach to record the 2022 transaction, Phillips Corporation should first update the
fair value adjustment by recording:
Multiple Choice
An unrealized holding gain of $28 million in 2022.
An unrealized holding loss of $10 million in 2022.
An unrealized holding gain of $8 million in 2022.
A gain of $8 million in 2022.
Transcribed Image Text:On March 25, 2021, Phillips Corporation purchased bonds of Atlas Corporation for $132 million and classified the securities as trading securities. On December 31, 2021, these bonds were valued at $150 million. Three months later, on April 3, 2022, Phillips Corporation sold these bonds for $140 million. As part of the multistep approach to record the 2022 transaction, Phillips Corporation should first update the fair value adjustment by recording: Multiple Choice An unrealized holding gain of $28 million in 2022. An unrealized holding loss of $10 million in 2022. An unrealized holding gain of $8 million in 2022. A gain of $8 million in 2022.
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