Accounting for Marketable Equity Securities

Tim Propp, CFO of Thunderbird, Inc., invested some of the firm's excess cash in the common shares of what he thought were three undervalued securities. At year-end, he reviewed how the portfolio of securities had done.

Security Name	Cost Basis	Market Value at Year-End	Classification
Microsoft Corporation	$100,000	$147,620	Trading security
Pfizer, Inc.	75,000	88,330	Trading security
Boeing, Inc.	50,000	58,080	Available-for-sale security
	$225,000	$294,030

Required

1. Calculate the value that would be assigned to the portfolio of securities on Thunderbird's balance sheet at year-end.

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2. Calculate the income statement effect of the portfolio of securities at year-end.

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