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On July 15, 2023, Sanders Ltd. purchased 5,000 common shares in Signet Mining Corporation for $32 per share and paid a $800 brokerage commission for
On July 15, 2023, Sanders Ltd. purchased 5,000 common shares in Signet Mining Corporation for $32 per share and paid a $800 brokerage commission for the purchase. Sanders intends to hold this investment for less than a year and classifies it as a Short-Term Investment. The market value of the shares at December 31, 2023, is $29 per share. On February 15, 2024 Signet Mining announced a 2 for 1 share split. Sanders sold one-half of the shares on March 31, 2024 for $15 per share. Which of the following is the correct accounting treatment on March 31, 2024? A. Debit Fair-Value Valuation Allowance for $15,000. B. Credit Short-Term Investments $160,000. C. Debit Loss on Sale of Investment for $70,000. D. Credit Gain on Sale of Investment for $2,500
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