Nixon Company purchased 10, 000 shares of Kostas Company as an available-for-sale security at $45 per share.Brokerage fees amounted to $1, 000 and transfer taxes were $750.The investment should be recorded at

A) $450, 000
B) $450, 750
C) $451, 000
D) $451, 750

Question

Keili Fullington · Accepted Answer

Final Answer : D, Explanation :  The investment should be recorded at the purchase price plus any associated costs. The purchase price is 10,000 shares * $45 = $450,000. Adding the brokerage fees of $1,000 and transfer taxes of $750 gives a total of $450,000 + $1,000 + $750 = $451,750.

Nixon Company purchased 10, 000 shares of Kostas Company as an available-for-sale security at $45 per share.Brokerage fees amounted to $1, 000 and transfer taxes were $750.The investment should be recorded at

A) $450, 000
B) $450, 750
C) $451, 000
D) $451, 750

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Nixon Company purchased 10, 000 shares of Kostas Company as an available-for-sale security at $45 per share.Brokerage fees amounted to $1, 000 and transfer taxes were $750.The investment should be recorded atA) $450, 000B) $450, 750C) $451, 000D) $451, 750

Definitions

Learning Objectives

Learning Objectives

Related questions

Nixon Company purchased 10, 000 shares of Kostas Company as an available-for-sale security at $45 per share.Brokerage fees amounted to $1, 000 and transfer taxes were $750.The investment should be recorded at

A) $450, 000
B) $450, 750
C) $451, 000
D) $451, 750