During Year 2, Copernicus Corporation held a portfolio of available-for-sale securities having a cost of $185,000. There were no purchases or sales of investments during the year. The market values at the beginning and end of the year were $225,000 and $160,000, respectively. The net income for Year 2 was $180,000, and no dividends were paid during the year. The Stockholders’ Equity section of the balance sheet was as follows on                                          December 31, Year 1:                                         Copernicus Corporation                                          Stockholders’ Equity                                           December 31, Year 1Common stock                                                        $ 50,000Paid-in capital in excess of par                                   250,000Retained earnings                                                       340,000Unrealized gain on available-for-sale investments     40,000                         Total                                                   $680,000Prepare the Stockholders’ Equity section of the balance sheet for December 31, Year 2.

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Asked Dec 20, 2019
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During Year 2, Copernicus Corporation held a portfolio of available-for-sale securities having a cost of $185,000. There were no purchases or sales of investments during the year. The market values at the beginning and end of the year were $225,000 and $160,000, respectively. The net income for Year 2 was $180,000, and no dividends were paid during the year. The Stockholders’ Equity section of the balance sheet was as follows on
                                          December 31, Year 1:
                                         Copernicus Corporation
                                          Stockholders’ Equity
                                           December 31, Year 1
Common stock                                                        $ 50,000
Paid-in capital in excess of par                                   250,000
Retained earnings                                                       340,000
Unrealized gain on available-for-sale investments     40,000
                         Total                                                   $680,000
Prepare the Stockholders’ Equity section of the balance sheet for December 31, Year 2.

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Compute retained earnings, Year 2. Retained earnings ] Retained earnings, Year 1+ for Year 2 Net income, Year 1 =$340,000+$180,000 = $520,000 Compute the unrealized gain (loss) as on December 31, Year 2. Details Amount ($) Available-for-sale investments at fair value, Year 2 $160,000 Less: Available-for-sale investments at cost, Year 2 (185,000) Unrealized gain (loss) on available-for-sale investments $(25,000)

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