At the End of Its First Year, the Securities Portfolio

Multiple Choice

At the end of its first year, the securities portfolio consisted of the following common stocks, all of which represent les then 20% ownership. In the following year, the Edmunds common stock is sold for cash proceeds of $57,000.The gain or loss to be recognized on the sale is a

A) gain of $1,200.
B) loss of $3,000.
C) gain of $10,600.
D) loss of $1,200.