On February 15, Jewel Company buys 7,600 shares of Marcelo Corp. common stock at

Question

On February 15, Jewel Company buys 7,600 shares of Marcelo Corp. common stock at $28.83 per share plus a brokerage fee of $430. The stock is classified as available-for-sale securities. On March 15, Marcelo Corp. declares a dividend of $1.30 per share payable to stockholders of record on April 15. Jewel Company received the dividend on April 15 and ultimately sells half of the Marcelo Corp. stock on November 17 of the current year for $29.60 per share less a brokerage fee of $280. The journal entry to record the sale of the 3,800 shares of stock on November 17

Explanation / Answer

1. Investment A/c Marcelo corp Dr. $219,108

Brokerage Fee A/c Dr. $430

To Cash A/c $219,538

2. Dividend Receivable A/c Dr. $9,880

To Dividend Income $9,880

3. Cash A/c Dr. $9,880

To Dividend Receivable A/c $9,880

4. Cash A/c Dr. $112,200

Brokerage fee Dr. $280

To Investment A/c $ 109,554

To income statement A/c $2926

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