Question
Brooks sells a portion of its trading securities (costing $3,000) for $4,000 cash. Analyze each transaction above by showing its effects on the accounting equationspecifically,
Brooks sells a portion of its trading securities (costing $3,000) for $4,000 cash. Analyze each transaction above by showing its effects on the accounting equationspecifically, identify the accounts and amounts (including + or ) for each transaction. ASSETS: 1A.debit investments-trading (increase 66000) 1A.cash (decrease 66000) 2A.fair value-trading (increase 6000- because of 72000-66000) 3A.debt investments trading (decrease 3000) 3A.cash (increase 4000)
No LIABILITIES,,,
EQUITY
2A.- Unrealized gain- income. increase 6,000
3A-gain on sale of debt investments increase 1,000
you want your total to be 7,000 and Assets (7k)= Libilities(0) + Equity (7k)
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Advanced Financial Accounting
Authors: Theodore E. Christensen, David M. Cottrell, Richard E. Baker
10th edition
78025621, 978-0078025624
