Hulse Company had the following transactions pertaining to stock investments. Fe

Question

Hulse Company had the following transactions pertaining to stock investments.

Feb. 1 Purchased 600 shares of Wade common stock (2%) for $7,200 cash. July 1 Received cash dividends of $1 per share on Wade common stock. Sept. 1 Sold 300 shares of Wade common stock for $4,300. Dec. 1 Received cash dividends of $1 per share on Wade common stock. Hulse Company had the following transactions pertaining to stock investments.

Feb. 1 Purchased 600 shares of Wade common stock (2%) for $7,200 cash. July 1 Received cash dividends of $1 per share on Wade common stock. Sept. 1 Sold 300 shares of Wade common stock for $4,300. Dec. 1 Received cash dividends of $1 per share on Wade common stock. Date Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS SHOW LIST OF ACCOUNTS SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT Hulse Company had the following transactions pertaining to stock investments.

Feb. 1 Purchased 600 shares of Wade common stock (2%) for $7,200 cash. July 1 Received cash dividends of $1 per share on Wade common stock. Sept. 1 Sold 300 shares of Wade common stock for $4,300. Dec. 1 Received cash dividends of $1 per share on Wade common stock. Hulse Company had the following transactions pertaining to stock investments. Purchased 600 shares of Wade common stock (2%) for $7,200 cash. Received cash dividends of $1 per share on Wade common stock. Sold 300 shares of Wade common stock for $4,300. Received cash dividends of $1 per share on Wade 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.) Explain how dividend revenue and the gain (loss) on sale should be reported in the income statement.

Explanation / Answer

In the books of Hulse Company Debit Credit 1-Feb Investment a/c 7200 To cash 7200 1-Jul Cash a/c 600 To dividend income 600 1-Sep Cash a/c 4300 To investment 3600 To profit on sale of invesment 700 1-Dec Cash a/c 300 To dividend income 300 Dividend income and profit on sale of shares is to be reported on the credit side of income statement

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