Data for investments in stock classified as trading securities are presented in E13-6. Assume instead that the investments are classified as available-for-sale securities with the same cost and fair value data. The securities are considered to be a long-term investment

\section*{Instructions}

(a) Prepare the adjusting entry at December 31, 1996, to report the securities at fair value.

(b) Show the statement presentation at December 31, 1996, after adjustment to fair value.

porting of the unrealized gains or losses. Write a letter to Mr. Arnet explaining the reporting and the purposes that it serves.