Seamus Industries Inc. buys and sells investments as part of its ongoing cash management

Seamus Industries Inc. buys and sells investments as part of its ongoing cash management. The following investment transactions were completed during the year:

Feb. 24. Acquired 1,000 shares of Tett Co. stock for $85 per share plus a $150 brokerage commission.

May 16. Acquired 2,500 shares of Issacson Co. stock for $36 per share plus a $100 commission.

July 14. Sold 400 shares of Tett Co. stock for $100 per share less a $75 brokerage commission.

Aug. 12. Sold 750 shares of Issacson Co. stock for $32.50 per share less an $80 brokerage commission.

Oct. 31. Received dividends of $0.40 per share on Tett Co. stock.

Journalize the entries for these transactions.


Answer:

Feb. 24 Investments—Tett Co. Stock* 85,150
Cash 85,150
*(1,000 shares × $85) + $150
May 16 Investments—Issacson Co. Stock* 90,100
Cash 90,100
*(2,500 shares × $36) + $100
July 14 Cash* 39,925
Gain on Sale of Investments 5,865
Investments—Tett Co. Stock** 34,060
*(400 shares × $100) – $75
**400 shares × ($85,150 ÷ 1,000 shares)
Aug. 12 Cash* 24,295
Loss on Sale of Investments 2,735
Investments—Issacson Co. Stock** 27,030
*(750 shares × $32.50) – $80
**750 shares × ($90,100 ÷ 2,500 shares)
Oct. 31 Cash* 240
Dividend Revenue 240
*(1,000 shares – 400 shares) × $0.40