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ABC Company purchased shares of stock of another company for $75,000 during 2008; the shares were...

ABC Company purchased shares of stock of another company for $75,000 during 2008; the shares were classified as trading securities. At the end of 2008, the shares were valued at $81,000 and at the end of 2009 were valued at $79,000. ABC owned no other securities. During 2010 the securities were sold for $83,000. With regard to these securities,what is the balance in the contra-asset account, Fair Value Adjustment Trading Securities at the end of 2009?
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Answer #1

Fair value adjustment trading securities = Market value-Purchase cost

= 79000-75000

Fair value adjustment trading securities = 4000 Debit balance

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