National Financial Services,Inc.invested $21,000 to acquire 6250 shares of Stonebridge Investments,Inc.on March 15,2015.This investment represents less than 20% of the investee's voting stock.On May 7,2018,National Financial Services,Inc.sells 3000 shares for $19,250.When the journal entry to record the sale is made,________.

Question

Quizplus · Accepted Answer

The sale of shares resulted in a gain, as the selling price of $19,250 for 3000 shares is higher than the cost basis of those shares. Therefore, Gain on Disposal will be credited.