On May 15, 2016, Breyer Co. invests $12,000 in Dave, Inc. stock. Dave pays Breye

Question

On May 15, 2016, Breyer Co. invests $12,000 in Dave, Inc. stock. Dave pays Breyer a $700 dividend on November 15, 2016. Breyer sells the Dave stock on December 10, 2016, for $11,600. Assume the investment is categorized as long-term available-for-sale. Journalize the 2016 transactions related to Breyer's investment in Dave stock

Begin by journalizing Breyer's initial investment in Dave, Inc., stock on May 15, 2016.

Next, journalize Breyer's receipt of the November 15, 2016 dividend

Now journalize Breyer's sale of the Dave, Inc., stock on December 10, 2016.

Explanation / Answer

Date Particulars Debit Credit 15-May,2016 Available for sale securities $ 12,000 Cash $ 12,000 15-November,2016 Cash $        700 Dividend Income $        700 10-December,2016 Cash $ 11,600 Realized Loss on available for sale securities $        400 Available for sale securities $ 12,000

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