Jarvis Corporation makes an investment in 100 shares of Saxton Company's common stock. The stock is purchased for $45 a share plus brokerage fees of $280. The entry for the purchase is:

Question

Quizplus · Accepted Answer

The total cost of the investment includes both the purchase price of the shares and the brokerage fees, so the entry should reflect the total cash outflow of $4,780 ($4,500 for the shares plus $280 in fees).

Jarvis Corporation Makes an Investment in 100 Shares of Saxton