On February 15, Jewel Company buys 7,300 shares of Marcelo Corp. common at $28.5

Question

On February 15, Jewel Company buys 7,300 shares of Marcelo Corp. common at $28.56 per share plus a brokerage fee of $410. The stock is classified as available-for-sale securities. On March 15, Marcelo Corp. declares a dividend of $1.18 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 $29.33 per share less a brokerage fee of $265. The fair value of the remaining 3,650 shares is $29.53 per share. The amount that Jewel Company should report in the asset section of its year-end December 31 balance sheet for its investment in Marcelo Corp. is: O $5,881 O $3,336 O $208,898. O $2,340 $107,784

Explanation / Answer

E. $107,784

The amount that Jewel Company should report in the asset section of its year-end December 31 balance sheet for its investment in Marcelo Corp. is:

= 3,650 shares × $29.53

= $107,784

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