Question

On January 1, 2017, Agronomist Inc. had a balance of $340,000 in the long-term investments account. During 2017, Agronomist Inc. sold long-term investments for $115,000 cash, resulting in a $13,000 gain. On December 31, 2018, the long-term investments account showed a balance of $380,000. The long-term investments purchased during 2013 totaled:

a) $155,000
b) $75,000
c) $142,000
d) $265,000

Answer 1

The correct amount of long-term investments purchased based on calculations would be $168,000, which is not one of the available options.

Step-by-step explanation:

The student has asked to calculate the total of long-term investments purchased by Agronomist Inc. during 2017. Initially, the company had a balance of $340,000 in the long-term investments account. At the end of 2017, after selling investments for $115,000 and realizing a $13,000 gain, the balance was $380,000. To find the amount invested, we need to account for the sale and the gain, and then determine how much was added to reach the new balance.

We calculate the adjusted beginning balance after the sale by subtracting both the cash received and the gain from the initial balance: $340,000 - $115,000 (cash) - $13,000 (gain), which equals $212,000. The ending balance is $380,000, so the investments purchased will be the difference between the ending balance and the adjusted beginning balance: $380,000 - $212,000, resulting in $168,000. However, this total is not available in the provided choices, which suggests there might have been an error in the question or the choices given.