A company has a long-term Investment in Available-for-Sale Securities. The investor's percentage ownership is 5%. On January 1, 2017, the purchase date, the cost of the stock investment was $107,000
On December 31, 2017, the fair value of the investment is $105,000. An allowance account is used to write-down the investment. On January 30, 2018, the investor sold the stock for $99,650. What journal entries are required on January 30, 2018?
A) debit Allowance to Adjust Investment in Available-for-Sale Securities to Market for $2000 and credit Unrealized Loss on Investment in Available-for-Sale Securities for $2000
B) debit Cash for $99,650, debit Loss on Sale of Investment in Available-for-Sale Securities for $7350 and credit Investment in Available-for-Sale Securities for $107,000
C) debit Cash for $99,650, debit Loss on Sale of Investment of Available-for-Sale Securities for $5350 and credit Investment in Available-for-Sale Securities for $105,000
D) A and B
D
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Indicate whether the statement is true or false