Answered step by step
Verified Expert Solution
Link Copied!

Question

...
1 Approved Answer

On February 15, Jewel Company buys 8,000 shares of Marcelo Corp.common stock at $29.03 per share. The stock is classified as a stock investment with

image text in transcribed

On February 15, Jewel Company buys 8,000 shares of Marcelo Corp.common stock at $29.03 per share. The stock is classified as a stock investment with insignificant influence. This is the company's first and only stock investment. On March 15, Marcelo Corp. declares a dividend of $1.40 per share payable to stockholders of record on April 15. Jewel Company received the dividend on April 15 and ultimately sells half of the Marcelo Corp. stock on November 17 of the current year for $29.80 per share. The journal entry to record the sale of the 4,000 shares of stock on November 17 is: Multiple Choice Debit Cash $119,200; credit Stock Investments $116,120; credit Gain on Sale of Stock Investments $3,080. Debit Cash $116,120; debit Loss on Sale of Stock Investments $3,080; credit Stock Investments $119,200. Debit Cash $119,200; credit Long-Term InvestmentsAFS $116,120, credit Gain on Sale of Long-Term Investments $3,080. Debit Cash $119,200, credit Long-Term Investments-Trading $116,120; debit Gain on Sale of Long-Term Investments $3,080. O Debit Cash $119,200, credit Long-Term Investments-Trading $116,120; credit Gain on Sale of Long-Term Investments $3,080

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Income Tax Fundamentals 2013

Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill

31st Edition

9781285586618

Students also viewed these Accounting questions