Investment in Securities In January 2007, Solitron, Inc., determined that it had excess cash on hand and
Question:
Investment in Securities In January 2007, Solitron, Inc., determined that it had excess cash on hand and decided to invest in Horner Company stock. The company intends to hold the stock for a period of three to five years, thereby making the investment an available-for-sale security. The following transactions took place in 2007, 2008, and 2009:
2007 Jan. 17 Purchased 2,750 shares of Horner Company stock for $89,500.
May 10 Received a cash dividend of $1.30 per share on Horner Company stock.
Dec. 31 The market value of the Horner Company stock was $30 per share.
2008 May 22 Purchased 750 shares of Horner Company stock at $40 per share.
July 18 Received a cash dividend of $0.90 per share on the Horner Company stock.
Dec. 31 The market value of the Horner Company stock was $42 per share.
2009 June 7 Received a cash dividend of $1 per share on the Horner Company stock.
Oct. 5 Sold the Horner Company stock at $27 per share for cash.
Dec. 31 The market value of the Horner Company stock was $25 per share.
Prepare the journal entries required to record each of these events.
Step by Step Answer:
Accounting Concepts And Applications
ISBN: 9780324376159
10th Edition
Authors: W. Steve Albrecht, James D. Stice, Earl K. Stice, Monte R. Swain