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ReportingFOR INSTRUCTOR USE ONLYH-19
Test Bank for Financial Accounting: Tools for Business Decision Making, Eighth Edition83.CGS Corporation makes an investment in 300 shares of Bama Company's commonstock. The stock is purchased for $53 a share. The entry for the purchase is:H-20
84.Gulf Coast Corporation makes an investment in 200 shares of Eta Company's commonstock. The stock is purchased for $52 a share. The entry for the purchase is
85.For accounting purposes, the method used to account for investments in common stock isdetermined byProblem Solving, IMA: FSA
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Reporting and Analyzing Investments86.Outer Banks Corporation sells 300 shares of common stock being held as an investment.The shares were acquired six months ago at a cost of $40 a share. Outer Banks sold theshares for $43 a share. The entry to record the sale isa.Cash12,000Loss on Sale of Stock Investments900Stock Investments8,600b.Cash12,900Gain on Sale of Stock Investments900Stock Investments12,000c.Cash12,900Stock Investments12,900d.Stock Investments12,000Loss on Sale of Stock Investments900Cash12,900Ans: B, LO: 2, Bloom: AP, Difficulty: Medium, Min: 2, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Measurement, AICPA PC:Problem Solving, IMA: FSASolution: (300 × $43)(300 × $40)$900(Sell. pr./sh. – inv, cost) × sh. sold

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