Valix Finacc vol 1 Problem 10-3

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 1 Problem 10-3

Requirement 1

a. Investment in equity securities                                                         309,000

         Cash                                                                                                                309,000

b. Investment in equity securities                                                      1,030,000

         Cash                                                                                                              1,030,000

Requirement 2

a. Cash                                                                                                405,000

 Loss on sale of investment                                                                32,750

         Investment in equity securities                                                                         437,750

 Lot No. 1 – 1,000 shares                                                                                           309,000

 Lot No. 2 -    500 shares (500/4,000 x 1,030,000)                                                        128,750

                                                                                                                                 437,750

b. Cash                                                                                                405,000

         Investment in equity securities (1,500/5,000 x 1,339,000)                                  401,700

  Gain on sale of investment                                                                                  3,300