Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Sweet Corporation made the following cash purchases of securities during 2020, which is the first year in which Sweet invested in securities. 1. 2. 3.
Sweet Corporation made the following cash purchases of securities during 2020, which is the first year in which Sweet invested in securities. 1. 2. 3. On January 15, purchased 9,800 shares of Sanchez Company's common stock at $33.50 per share plus commission $1,944. On April 1, purchased 4,900 shares of Vicario Co.'s common stock at $52 per share plus commission $3,299. On September 10, purchased 6,860 shares of WTA Co.'s preferred stock at $26.50 per share plus commission $4,810. On May 20, 2020, Sweet sold 3,724 shares of Sanchez Company's common stock at a market price of $35 per share less brokerage commissions, taxes, and fees of $3,773. The year-end fair values per share were Sanchez $30, Vicario $55, and WTA $28. In addition, the chief accountant of Sweet told you that the corporation plans to hold these securities for the long-term but may sell them in order to earn profits from appreciation in prices. The equity method of accounting is not appropriate for these stock purchases. Prepare the journal entries to record the above three security purchases. (Round answers to 0 decimal places, e.g. 2,500. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) No. Date Account Titles and Explanation Debit Credit (1) TJan. 15, 2020 v X (2) Apr. 1, 2020 10000 (3) Sep. 10, 2020 V
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started