Question

Journal Chart of Accounts Instructions Instructions On September 12, 15,000 shares of Aspen Company are acquired at a price of $25 per share plus a $145 brokerage commission. On October 15, a $0.30-per-share dividend was received on the Aspen stock. On November 10, 6,200 shares of the Aspen stock were sold for $34 per share less a $130 brokerage commission. Journalize the entries to record the original purchase, the dividend, and the sale under the cost method. Refer to the Chart of Accounts for exact wording of account tities. When required, round your answers to the nearest dollar.

Answer 1

Answer-1- Journal Entries

Date	Account Title and Explanation	Debit ($)	Credit ($)`
Sep.12	Investment- Aspen Company Stock (15,000 shares *$25 per share )+$145	375,145
	Cash		375,145
	(To record acquisition of shares of Aspen Company)
Oct.15	Cash ($0.30 per share * 15,000 shares)	4,500
	Dividend revenue		4,500
	(To record the receipt of cash dividend)
Nov.10	Cash (6,200 shares *$34 per share )-$130	210,670
	Investment-Aspen Company Stock ($375,145*6,200/ 15,000)		155,060
	Gain on sale of investments ($210,670-$155,060)		55,610
	(To record sale of investments)

2-Journal Entries

Date	Account Title and Explanation	Debit ($)	Credit ($)
Feb 24	Investment-Tett Co. (300 shares *$113)+132	34,032
	Cash		34,032
	(To record the purchase of stock)
May 16	Investment- Company I (2,400*$46)+$384	110,784
	Cash		110,784
	(To record the purchase of stock)
July 14	Cash (100 shares *$125)-$81	12,419
	Investment ($34,032*100/300)		11,344
	Gain on sale of investment ($12,419-$11,344)		1,075
	(To record the sale of stock)
Aug 12	Cash (900 shares *$36)-$112	32,288
	Loss on sale of investment ($41,544-$32,288)	9,256
	Investment ($110,784*900/2,400)		41,544
	(To record the sale of stock)
Oct.31	Cash ($0.38*200 shares) (300-100=200 shares)	76
	Dividend Income		76
	(To record dividend income)

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