1.On January 1, 2016, TXU Europe Corporation purchased 40% of the outstanding stock of Alberta Power Pool Corporation for $800,000. Net income reported by Alberta Power Pool Corporation for 2016 and 2017 was, respectively, $100,000 and $125,000. Dividends paid by Alberta Power Pool Corporation during 2016 and 2017 were, respectively, $60,000 and $75,000. The longterm investment will appear on TXU Europe Corporation's December 31, 2016, balance sheet at:

A.$800,000

B.$776,000

C.$816,000

D.$840,000

2. The adjusting entry for investments at fair value through other comprehensive income contains a credit to Investments for $651. The income statement will reflect:

A.other comprehensive income/loss of ($651)

B.an extraordinary gain of $651

C.revenue of $651

D.nothing, because gain/loss is not reported on the income statement

3.The Gain/Loss on Investment account may appear on which financial statement?

A.the income statement under the "other income/expense" section

B.the balance sheet under the "assets" section as a contra asset

C.the balance sheet under the "liabilities" section

D.the balance sheet as part of the shareholders' equity