Acct 201 - Dryfus Company, Problem

332 Words2 Pages
ACCT 201 - Dryfus Company, Problem Dryfus Company, which began operations in 2002, invests its idle cash in trading securities. The following transactions relate to the company's short-term investments in its trading securities. 2002 Transactions in Trading Securities Mar. 10 Purchased 2,450 shares of Ford Motor Company, at $26 per share plus $1,653 commission. May 7 Purchased 2,200 shares of Lucent at $44.25 per share, plus a $968 commission. Sep. 1 Purchased 1,200 shares of Black and Decker at $47.50 per share plus a $675 commission. 2003 Transactions in Trading Securities Apr. 26 Sold 2,200 shares of Lucent at $43.75 per share less a $1,050 commission. 27 Sold 1,200 shares of Black and Decker at $49.25 less a $735 commission. June 2 Purchased 2,500 shares of Merck stock at $72.50 per share plus a $3,890 brokerage fee. 14 Purchased 900 shares of Wal-Mart at $50.25 per share plus a $1,082 commission. 2004 Transactions in Trading Securities Jan. 28 Purchased 2,500 shares of Dell Co. stock at $39.50 per share plus a $2,356 commission. 31 Sold 2,500 shares of Merck at $71.25 per share less a brokerage commission of $2,356. Aug. 22 Sold 2,450 shares of Ford Motor Company, at $23.50 per share less $1,437 commission. Sep. 3 Purchased 3,400 shares of Nokia stock at $41.25 per share plus a $3,000 brokerage fee. Oct. 9 Sold 900 shares of Wal-Mart at $51.25 per share less a $1,025 commission. Required: 1. Prepare journal entries to record these short-term investment activities for the years shown. (Ignore any year-end adjusting entries.) 2. On December 31, 2004, prepare the adjusting entry to record the market value of these investments: Nokia's share price was $42.75 and Dell's share price was $42. (The Market Adjustment - Trading account had an unadjusted balance of

More about Acct 201 - Dryfus Company, Problem

Open Document