The following selected account balances were taken from Buckeye Company\'s gener
ID: 2434018 • Letter: T
Question
The following selected account balances were taken from Buckeye Company's general ledger at
January 1, 2007 and December 31, 2007:January 1, 2007 December 31, 2007Accounts receivable 50,000 71,000Inventory 39,000 28,000Accounts payable 45,000 54,000Salaries payable 7,000 3,000Investments 59,000 46,000Common stock 110,000 130,000Retained earnings 21,000 45,000The following selected information was taken from Buckeye Company's 2007 statement of cash
flows:Cash collected from customers $385,000Cash paid to purchase inventory 199,000Cash paid to employees 80,000Cash received from sale of investments 15,000Cash paid for dividends 30,000Calculate the amount of the gain on sale of investments reported in Buckeye Company's 2007
income statement. Do not use decimals in your answer or type the word gain after your answer.
The following selected account balances were taken from Buckeye Company's general ledger at
January 1, 2007 and December 31, 2007:January 1, 2007 December 31, 2007Accounts receivable 50,000 71,000Inventory 39,000 28,000Accounts payable 45,000 54,000Salaries payable 7,000 3,000Investments 59,000 46,000Common stock 110,000 130,000Retained earnings 21,000 45,000The following selected information was taken from Buckeye Company's 2007 statement of cash
flows:Cash collected from customers $385,000Cash paid to purchase inventory 199,000Cash paid to employees 80,000Cash received from sale of investments 15,000Cash paid for dividends 30,000Calculate the amount of the gain on sale of investments reported in Buckeye Company's 2007
income statement. Do not use decimals in your answer or type the word gain after your answer.
Explanation / Answer
Investment A/c is an Asset
Stt of Cash has only one entry on Cash Rxd on Sale ofInvestemnts = 15000
So Op/Bal - Cl/Bal = Sale of Investment as no newInvestment is bought SO Sale of Investment = 59000 - 46000 = 13000 As cash Rxd from Sale of Investment = 15000 Profit on Sale of Investmnet = 15000-13000 = 2000