Wheeler Inc. owned the following available-for-sale investments as of December 31, 20Y4:

During 20Y5, Wheeler Inc. did not purchase or sell any available-for-sale securities. The fair value of the Bernard Co. and Chadwick Co. securities as of December 31, 20Y5, were as follows:

a. What was the balance of Valuation Allowance for Available-for-Sale Investments as of January 1, 20Y5?
b. Journalize the adjustment to fair value for the available-for-sale investments as of December 31, 20Y5.
c. After the adjustment in (b), what is the balance of Valuation Allowance for Available-for-Sale Investments?
d. Do changes in fair value of available-for-sale securities affect Wheeler Inc.’s net income?
e. If the portfolio of securities held by Wheeler Inc. had been classified as trading securities, how would the investment be reported on the income statement for the year ending December 31, 20Y5, and the December 31, 20Y5, balance sheet?

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Issuing Company Cost Fair Value Bernard Co. $ 38,250 $ 37,500 Chadwick Co. 65,520 63,770 Totals $103,770 $101,270