Question

Wheat Corporation pays $ 528 comma 000 for 100 comma 000 shares to acquire 45​% common stock of Grain​ Investments, Inc. on January​ 5, 2018. Wheat Corporation sells 12 comma 000 shares for $ 54 comma 000 on January​ 6, 2018. What is the correct journal entry for the transaction on January​ 6, 2018?​ (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest​ dollar.)

Answer 1

Step-by-step explanation:

Based on the information given in the question, the following can be deduced:

The purchase price per share will be:

= $528,000/100,000

= $5.28

The selling price per share will be:

= $54,000/12,000 = $4.50

The loss on the sale of the marketable securities will then be:

= 12,000 x (4.50 - 5.28)

= 12,000 × 0.78

= $9,360

The file has been attached.