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On August 1, Sandhill Company buys 1,060 shares of BCN common stock for $32,520 cash. On December 1, the stock investments are sold for $39,470 in cash. Journalize the purchase and sale of the common stock. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Respuesta :

Parrain

Answer: Please refer to Explanation

Explanation:

Date

August 1

DR Stock Investments $32,520

CR Cash $32,520

(To Record purchase of stock)

December 1

DR Cash $39,470

CR Stock Investment $32,520

CR Gain on Sale of Investment $6,950

(To record Sale of Investment)

Working

Gain on sale of investment = Selling Price - Cost Price

= 39,470 - 32,520

= $6,950

Narrations are not needed in the question but I included them for knowledge.

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