I'm actually looking for the answer to e. I cannot find anything in my book concerning this. Any help on the answer for e would be appreciated.

The FASB issuedSFAS No. 115to describe the accounting treatment that should be afforded to equity securities that have readily determinable market values that are not accounted for under the equity method or consolidation. An important part of the statement concerns the distinction between trading securities and available -for-sale securities.

Required:

a.Compare and contrast trading securities and available for sale securities.

b.How are the trading securities and available-for-sale securities classified in the balance sheet? In your answer, discuss the factors that should be considered in determining whether a security is classified as trading or available-for-sale and as current or noncurrent.

c.How do above classifications affect the accounting treatment for unrealized losses?

d.Why does a company maintain an investment portfolio containing current and noncurrent securities?

e.If a company elects to adopt fair -value accounting for securities that are classified as available-for-sale simultaneously with the adoption ofSFAS No. 159, what effect would the election have on its financial statements?