T 1
May 9, 2013, 02:55 AM
1. On July 1, 215 Corp. borrowed funds from a bank by signing a long-term note. Repayment is at the option of the borrower but interest will accrue on the unpaid balance. Interest will be determined at year-end
2.Purchased stock as a long-term investment in another company (This is an investing cash flow)
3.The stock purchased in event 2 is sold for cash
4. Existing owners purchased additional shares of stock in this company
Is it correct:
1. Dr Cash xxx
Cr Notes Payable xxx
2.Dr Long-term Investments xxx
Cr Cash xxx
3. Dr Cash xxx
Cr Common Stock xxx
Cr gain on sale of investments
4.Dr Common Stock xxx
Cr Cash xxx
Thank you!
2.Purchased stock as a long-term investment in another company (This is an investing cash flow)
3.The stock purchased in event 2 is sold for cash
4. Existing owners purchased additional shares of stock in this company
Is it correct:
1. Dr Cash xxx
Cr Notes Payable xxx
2.Dr Long-term Investments xxx
Cr Cash xxx
3. Dr Cash xxx
Cr Common Stock xxx
Cr gain on sale of investments
4.Dr Common Stock xxx
Cr Cash xxx
Thank you!