Augsburg Corporation recorded the following transactions for itslong-term investments during 2018: May 22 Purchased 1,000 shares of
Question:
Augsburg Corporation recorded the following transactions for itslong-term investments during 2018:
May 22 Purchased 1,000 shares of MillerCorporation stock at $55 per share plus brokerage fees of $1,000and classified the shares as FVTPL financial assets. MillerCorporation has 30,000 shares outstanding.
June 30 Received a cash dividend of $0.80 pershare on Miller Corporation stock.
August 26 Sold 400shares of Miller Corporation stock for $60 per share.
December 31 Miller common stock had a closing marketprice of $50 per share. The decline is considered to betemporary.
Given the information above, on May 22, Augsburg should
a. Debit Cash for $56,000
b. Debit Fair Value through Profit or Loss Financial assetsfor $56,000
c. Debit Fair Value through Profit or Loss Financial assetsfor $55,000
d. Credit Cash for $55,000
Expert Answer:
The detailed answer for the above question is provided below Answer b Debit Fair Value through Profi... View the full answer
Intermediate Accounting
ISBN: 978-0324312140
16th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
