Question 5 Given the following information about Ultra Inc.?s portfolio of investments: Cost Fair Value 12/31/04 2005
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Question 5
Given the following information about Ultra Inc.?s portfolio of investments:
Cost | Fair Value 12/31/04 | 2005 Purchases | 2005 Sales | Fair Value 12/31/05 | |||||
Held-to-maturity securities | |||||||||
Security J | $128,000 | $130,000 | |||||||
Trading equity securities | |||||||||
Security K | $700,000 | $725,000 | 705,000 | ||||||
Security A | 100,000 | 110,000 | $150,000 | ||||||
Available-for-sale equity securities | |||||||||
Security S | 400,000 | 380,000 | 500,000 | ||||||
Security L | 100,000 | 95,000 | 102,000 |
Assume that Security J is a debt security that was purchased at a premium. The premium amortization for 2005 was $3,000. All declines in fair value are considered temporary.
What is the carrying amount of Security J at December 31, 2005?
$125,000 | |
$128,000 | |
$130,000 | |
$131,000 |
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