The Shasta Corporation began operations in 2018. Shasta's portfolio of minority passive investments reported the following on December 31, 2018: Equity InvestmentsCost$450,000Fair value$395,000Which of the following is correct with respect to the accounting for Shasta's investment portfolio?
A. Net income was decreased $55,000 during 2018.
B. Net income and total stockholders' equity were decreased $55,000 as of December 31, 2018.
C. Net income and total stockholders' equity were increased $55,000 as of December 31, 2018.
D. Net income was increased $55,000 during 2018.
Answer: B
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