REFERENCE: 01-11
on January 4,2018,Mason Co $\begin{array}{llr} \text { Cash} &150,000\\ \text { Investment in Hefly } &&150,000\\\end{array}$

REFERENCE: 01-11
On January 4,2018,Mason Co.purchased 40,000 shares (40%) of the common stock of Hefly Corp. ,paying $560,000.At that time,the book value and fair value of Hefly's net assets was $1,400,000.The investment gave Mason the ability to exercise significant influence over the operations of Hefly.During 2018,Hefly reported income of $150,000 and paid dividends of $40,000.On January 2,2019,Mason sold 10,000 shares for $150,000.
-What is the appropriate journal entry to record the sale of the 10,000 shares?
A.
$\begin{array}{llr} \text { Cash} &150,000\\ \text { Investment in Hefly } &&150,000\\\end{array}$

B.
$\begin{array}{llr} \text { Cash} &150,000\\ \text { Investment in Hefly } &&130,000\\ \text { Gain on sale of investment } &&20,000\end{array}$

C.
$\begin{array}{llr} \text { Cash } &150,000\\ \text { Loss on sale of investment } &1,000\\ \text { Investment in Hefly } &&151,000\end{array}$

D.
$\begin{array}{llr} \text { Cash} &150,000\\ \text { Investment in Hefly } &&149,000\\ \text { Gain on sale of investment} &&1,000\end{array}$

E.
$\begin{array}{llr} \text { Cash} &150,000\\ \text {Loss on sale of investment } &10,000\\ \text { Investment in Hefly } &&160,000\end{array}$

A) A Above
B) B Above
C) C Above
D) D Above
E) E Above