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Question(s) / Instruction(s):

ABC Company reported a permanent decline in market value of one of its long-term investments.
The total aggregate market value of the portfolio exceeded its cost. What would the recognition of the permanent decline cause?          
A.    no effect on income because declines in market value are adjusted to retained earnings
B.    no effect on income because aggregate market value exceeds cost
C.    a loss in the amount of the permanent decline
D.    an adjustment to an allowance account for decline in market values

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