Following are extracts from the unadjusted trial balance of York Co. for its year ended December 31, 20X6.

Following are extracts from the unadjusted trial balance of York Co. for its year ended

December 31, 20X6. Each item has its normal debit or credit balance, but the total does not

equal $0 because the trial balance excludes various accounts that would normally be

included.

York Co.

Trial balance — extracts

Year ended December 31, 20X6

FVOCI investments — January 1, 20X6 $140,000

Common shares 95,000

Retained earnings — January 1, 20X6 70,000

Dividends declared 21,000

Preference shares 100,000

Loss on discontinued operations 18,000

Profit or loss ?

Additional information:

 The fair value of the investment at FVOCI (fair value through other comprehensive

income) as of December 31, 20X6, was $125,000. York did not purchase or sell any

additional investments at FVOCI during the year.

 The dividends pertaining to the outstanding preference shares were declared on

December 23, 20X6, payable to shareholders of record on December 29, 20X6, on

January 4, 20X7.

 The common shares have no par value. 100,000 shares are authorized, and 60,000

shares were originally issued on January 1, 20X4. A further 35,000 shares were issued

on July 1, 20X6. All shares were sold for $1 each.

 The 25,000 preference shares authorized have no par value. 15,000 shares were

issued (sold) for $10 each on August 1, 20X5. On October 31, 20X6, York paid $9 each

to repurchase 5,000 preference shares from its investors. The shares were immediately

cancelled.

Assume that profit for the year was $90,000. What is the net change in equity that York will

report on the statement of changes in equity for the year ended December 31, 20X6?

a) $26,000 increase

b) $39,000 increase

c) $44,000 increase

d) $65,000 increase