Interpreting Footnotes on Security Investments Cisco Systems Inc. reports the following information derived from its 2016 10-K report. (Note: Ciscos 2016 disclosures are consistent with the former accounting rules for marketable equity securities. See the Accounting Insight box on page 9-6 in the textbook.)

				Accumulated
		Common Stock		Other	Total Cisco's
	Shares of	and Additional	Retained	Comprehensive	Shareholders'	Noncontrolling
$ millions	Common Stock	Paid in Capital	Earnings	Income (Loss)	Equity	Interests	Total Equity
Balance at July 25, 2015	5,085	$43,592	$16,045	$61	$59,698	$9	$59,707
Net income			10,914		10,914		10,914
Change in:
Unrealized gains and (losses) on investments, net				111	111	(10)	101
Derivative instruments				(43)	(43)		(43)
Cumulative translation adjustment and other				(472)	(472)		(472)
Other comprehensive income (loss)				(404)	(404)	(10)	(414)
Issuance of common stock	113	1,127			1,127		1,127
Repurchase of common stock	(148)	(1,280)	(2,638)		(3,918)		(3,918)
Repurchase of common stock for tax withholdings on vesting of restricted stock units	(21)	(557)			(557)		(557)
Cash dividends declared			(4,750)		(4,750)		(4,750)
Tax effects from employee stock incentive plans		30			30		30
Share-based compensation		1,458			1,458		1,458
Purchase acquisitions		146			146		146
Balance at July 30, 2016	$5,029	$44,516	$19,571	$(343)	$63,744	$(1)	$63,743

Summary of Available-for-Sale Investments The following table summarizes the Company's available-for-sale investments (in millions).

		Gross	Gross
	Amortized	Unrealized	Unrealized
July 30, 2016	Cost	Gains	Losses	Fair Value
Fixed income securities
U.S. government securities	$26,681	$81	$(2)	$26,760
U.S. government agency securities	2,809	8	-	2,817
Non-U.S. government and agency securities	1,096	4	-	1,100
Corporate debt securities	24,044	263	(15)	24,292
U.S. agency mortgage-backed securities	1,846	22	-	1,868
Total fixed income securities	$56,476	378	(17)	$56,837
Publicly traded equity securities	1,211	333	(40)	1,504
Total	$57,687	$711	$(57)	$58,341

a. What is the amount of Ciscos investment portfolio on its balance sheet? $Answer

million b. What does the number $111 represent in the Accumulated Other Comprehensive Income column?

The amount represents an unrealized loss on trading securities that resulted from a decrease in their value during the year.

The amount represents an unrealized loss on available for sale securities that resulted from a decrease in their value during the year.

The amount represents an unrealized gain on trading securities that resulted from an increase in their value during the year.

The amount represents an unrealized gain on available for sale securities that resulted from an increase in their value during the year.

1.00 points out of 1.00

c. Under the new accounting rules that take effect in 2018, how would Cisco treat the $111?

Under the new rules, the amount would not be added to AOCI, instead the unrealized gain would be included in 2015 income.

Under the new rules, the treatment of unrealized gains on securities does not change; the amount would continue to be added to AOCI.

Under the new rules, the amount would not be added to AOCI, nor would it be included in 2015 income.

0.00 points out of 1.00

d. Compute comprehensive income for 2015. $Answer

million