Which entry depicts the sale of 400 shares Harris Corp. common stock for 6300 cash less...

Which entry depicts the sale of 400 shares Harris Corp. common stock for 6300 cash less fees $600. The original purchase of the shares was for $5000 less fees for $400

Cash xxx

C/S investment. xxx

Gain on sale on C/S. xxx

Expert Solution

When a company sells an investment, it results in a gain or loss which is recognized in income statement. A gain on sale of investment arises when the (disposal) value of an investment exceeds its cost. Similarly, a capital loss is when the value of investment drops below its cost.

Accounting treatment of a disposal of investment depends on:

the nature of the investment i.e. whether it is a share of common stock, preferred stock, a bond, etc.,
the extent of the investment i.e. the percentage holding, and
the initial recognition and continuing accounting of the investment.

Investments in shares of common stock are accounted for using either the fair value through profit and loss, fair value through other comprehensive income, equity method or consolidation depending on the extent of ownership.

Journal Entry for sale of an investment:-

Particulars	Debit	Credit
Cash	6,300
Sale of Investment		5,000
Gain on Sale of Investment		1,300

ekkarill92 answered 2 years ago

Oxen Corp. has 1,000 shares of common stock outstanding. Cherith owns 400 of these shares and...

Oxen Corp. has 1,000 shares of common stock outstanding. Cherith owns 400 of these shares and Marshall owns 600. Marshall’s total basis in his 600 shares is $40,000. Oxen has $500,000 of accumulated E&P as of the beginning of the year, and Oxen is profitable this year. Assume that Oxen redeems 210 shares of Marshall’s stock during the year for $80,000. Marshall seeks to determine if the redemption qualifies for sale treatment as a disproportionate redemption under Section 302(b)(2). Would...

Cheyenne Corp. issued 1,800 shares of common stock. Prepare the entry for the issuance under the...

Cheyenne Corp. issued 1,800 shares of common stock. Prepare the entry for the issuance under the following assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,675. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (a) The stock had a par value of $8.25 per share and was issued for a total of $46,000. (b) The stock...

1 Corp X is authorized to issue 1,000,000 shares of Common Stock Par $1 No Entry...

1 Corp X is authorized to issue 1,000,000 shares of Common Stock Par $1 No Entry since it was just authorized but not issued. 2 Corporation X issued 500,000 shares of Common Stock Par $1 for $ 8 per share 3 Corporation X issued 1,500,000 shares of Common Stock Par $1 for $10 per share 4 Corporation X reacquired 1,000,000 shares of their Common Stock Par $1 for $ 2 5 Sold 500,000 shares of treasury stock at $8 per...

Infosys Company issued 200,000 shares of its common stock for cash. The journal entry to record...

Infosys Company issued 200,000 shares of its common stock for cash. The journal entry to record the stock issue would include Select one: a. A debit to Common Stock b. A debit to Retained Earnings c. A credit to Cash d. A credit to Common Stock

What is the journal entry for the sale of 5,000 shares of $1 par value common...

What is the journal entry for the sale of 5,000 shares of $1 par value common stock for $9/share? Debit Common Stock 5,000; Credit Cash 5,000 Debit Cash 5,000; Credit Common Stock 5,000 Debit Cash 45,000; Credit Common Stock 45,000 Debit Cash 45,000; Credit Common Stock 5,000, Credit Paid-In Capital in Excess of Par-Common 40,000 What is the journal entry for the purchase of 500, $2 par value common stock for $20 as treasury shares? Debit Common Stock 1,000, Debit...

Create the journal entry to establish a petty cash fund of $400 for Johnson Corp. on...

Create the journal entry to establish a petty cash fund of $400 for Johnson Corp. on November 1. On November 30, a physical count of the petty cash shows a balance of $277 along with the following receipts: Postage Expense $40 Misc. Expenses $80 Prepare the journal entry for November 30 to reimburse the petty cash. On December 1, Johnson Corp. wants to increase the petty cash balance to $450. Prepare the entry to increase the petty cash. Clayborn Company...

how to compute for gain on sale of land, cash from sale of common stock, and...

how to compute for gain on sale of land, cash from sale of common stock, and cash used for dividends?

Last week, you sold 400 shares of ABD stock for $12,400. The sale was a short...

Last week, you sold 400 shares of ABD stock for $12,400. The sale was a short sale with an initial margin requirement of 70%. The maintenance margin is 40%. Some positive news concerning the company was released last night and the stock price jumped this morning to $38 per share. You decide to close out the account. QUESTION #2) What is your HPR on this investment? QUESTION #3) Which of the following prices will lead to a margin call if...

Harris Pilton has 150,000 shares of common stock outstanding on January 1. On February 1, the...

Harris Pilton has 150,000 shares of common stock outstanding on January 1. On February 1, the company issued 50,000 additional shares for $50.00 each. On April 30, the company repurchased 5,000 treasury shares. On June 1, the company made a 4-for-3 bonus issue. On August 1, the company issued 1,000 new shares of common stock for $45.00 each. On September 30th, the company issued a 15% stock dividend. Harris Pilton has 2,000 shares of 5%, $10 par, noncumulative, nonconvertible preferred...

You will provide the journal entry to record issuing of common stock shares by a corporation,...

You will provide the journal entry to record issuing of common stock shares by a corporation, record issuing of cumulative preferred stock, and record a declaration of stock split. Part 1: Company A During 2018, Company A has the following transactions involving its common and preferred stock: Issued 20,000 shares of $8 par common stock for $26 a share; brings total shares outstanding to 50,000 shares Issued 6,000 shares of $100 par, 6%, cumulative preferred stock for $150 per share...

Question