The Jackson Company purchased 100 shares of Union Company for $1000 in 2020 and correctly accounts...
The Jackson Company purchased 100 shares of Union Company for $1000 in 2020 and correctly accounts for this investment under the fair value method. At the end of 2020 Jackson’s investment in Union stock was worth $980 and on February 4th 2021 Jackson sold all its Union stock for $1040. What gain or loss does Jackson show on the sale of the Union stock?
Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.
a
Gain $40
b
Gain $60
c
Gain $1040
d
Loss $980
Homework Answers
Ans is option B. As the cost price for sales is 980 not 1000.
Sale price -cost price=profit/(loss)
1040-980=60 gain
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