Winsted Co. purchased a bond on December 1 of the current year for $ 49 comma 000 and classified the investment as trading. The market value of the investment at year-end is $ 52 comma 000. What value will be reported in net income for the adjustment?

A. $ (3 comma 000)

B. $ 52 comma 000

C. $ 3 comma 000

D. $ 49 comma 000

Net income = $3000

C. $ 3 comma 000

Explanation:

For a company, net income is the residual amount of earnings after all expenses have been deducted from sales. In short, gross income is an intermediate earnings figure before all expenses are included, and net income is the final amount of profit or loss after all expenses are included.

In this case ... There is only a buy and a sell trade.

Net income = selling price - cost price

Net income = $52000-$49000

Net income = $3000