At December 31, 2011, Atlanta Co. has a stock portfolio valued at $40,000. Its cost was $33,000. If the Securities Fair Value Adjustment (Available-for-Sale) has a debit balance of $2,000, which of the following journal entries is required at December 31, 2011?
a. Securities Fair Value Adjustment 7,000
(Available-for-Sale)
Unrealized Holding Gain or Loss-Equity 7,000
b. Securities Fair Value Adjustment 5,000
(Available-for-Sale)
Unrealized Holding Gain or Loss-Equity 5,000
c. Unrealized Holding Gain or Loss-Equity 7,000
Securities Fair Value Adjustment 7,000
(Available-for-Sale)
d. Unrealized Holding Gain or Loss-Equity 5,000
Securities Fair Value Adjustment 5,000
(Available-for-Sale)
Answer: B