Question

yeloe corporation sells 400 shares of common stock being held as an investment. The shares were acquired six months ago at a cost of $60 a share. Yelo sold the shares for 40 share the entry to recordd the sale is

Answer 1

Entry is given below

Step-by-step explanation:

Bought shares 6 months ago = 400shares x $60/share

Bought shares 6 months ago = $24,000

Sold shares = 400shares x $40/share

Sold shares = $16,000

Loss on sales proceeds = $24,000 - $16,000

Loss on sales proceeds = $8,000

Entry:

DEBIT CREDIT

Cash $16,000

Loss on sale $8,000

Shares $24,000