Comprehensive Problem 4 Part 1: Selected transactions completed by Equinox Produ

Question

Comprehensive Problem 4
  Part 1:

Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2014, were as follows:

1.  Journalize the selected transactions.

If no entry is required, select "No entry required" from the dropdown and leave the amount boxes blank. For a compound transaction, if an amount box does not require an entry, leave it blank.

e.  Paid the cash dividends declared in (d).

f.  Purchased 7,500 shares of Solstice Corp. at $40 per share, plus a $150 brokerage commission. The investment is classified as an available-for-sale investment.

Explanation / Answer

e. Paid the cash dividends declared in (d).

Description Debit Credit

Dividend Payable Dr 70,000

Cash Cr 70,000

f. Purchased 7,500 shares of Solstice Corp. at $40 per share, plus a $150 brokerage commission. The investment is classified as an available-for-sale investment.

Description Debit Credit

Long Term Inv Dr $300,150

Cash Cr $300,150

(7500*40+150 =$300,150)

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