Question
Presented below is selected information related to the financial instruments of Carla Company at December 31, 2017. This is Carla Companys first year of operations.
Presented below is selected information related to the financial instruments of Carla Company at December 31, 2017. This is Carla Companys first year of operations. Carrying Amount Fair Value (at December 31) Investment in debt securities (intent is to hold to maturity) $36,300 $37,200 Investment in Chen Company stock 869,300 982,800 Bonds payable 241,100 216,200 (a) Carla elects to use the fair value option for these financial instruments (the fair value option for financial liabilities is discussed in Chapter 14). Assuming that Carlas net income is $98,400 in 2017 before reporting any securities gains or losses, determine Carlas net income for 2017 (assume that the difference between the carrying value and fair value is due to credit deterioration). Carlas net income for 2017=
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