Question 5 Nosker Inc. had the following transactions pertaining to investments

Question

Question 5

Nosker Inc. had the following transactions pertaining to investments in common stock.

Journalize the transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1 Purchased 2,920 shares of Escalante Corporation common stock (5%) for $163,520 cash. July 1 Received a cash dividend of $2 per share. Dec. 1 Sold 584 shares of Escalante Corporation common stock for $37,376 cash. Dec. 31 Received a cash dividend of $2 per share.

Explanation / Answer

Jan 1 - DR Investments 163,520

CR Cash 163,520 [2,920 shares @ 56 per share]

Purchased shares @56

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July 1 - DR Cash 5,840

CR Dividend Income 5,840

Dividend received for 2920 shares @ 2

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Dec 1 - DR Cash 37,376

CR Investments 32,704 [584 shares @ 56]

CR Gain on sale 4,672

Sold investment at profit

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Dec 31 - DR Cash 4,672

CR Dividend Income 4,672 [2,336 shares @ $2)

Received dividend on remaining shares(2,920-584)

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