The effects of price changes in marketable securities are reported a. as a gain or loss on the income statement b. as an increase or decrease in stockholders' equity 7. either as a gain or loss on the income statement or the balance sheet, depending upon the classification of the securities the number of shares owned d. either as a gain or loss on the income statement, depending upon 8. Kershaw Bookstore had 500 units on hand at January I, costing $18 each. Purchases and sales during the month of January were as follows: Sales 375@S28 Datc Purchases Jan. 14 17 25 29 250@$20 250 $22 250@ $32 Kershaw does not maintain perpetual inventory records. According to a physical count, 375 units were on hand at January 31. The cost of the inventory at January 31, under the FIFO method is: a $1,000. b. $6,750. c. $7,750. d. $8,000. 9. Which of the following expressions is incorrect? a. Gross profit-operating expenses net income b. Sales-cost of goods sold- operating expenses net incomo c. Net income+ operating expenses gross profit d. Operating expenses-cost of goods sold gross profit 10. The ownership claim arising from the reinvestment of previous profits is called a. net assets b. stockholders' equity c. investment income d. retained earnings Page 5 of 7