Tarkenton Corporation purchased the following portfolio of trading securities during 2014 and reported the following balances at December 31,2014.No sales occurred during 2014.All declines are considered to be temporary. The only transaction in 2015 was the sale of security Z for $35,000 on December 31,2015.The market values for the other securities at December 31,2015,were the same as at December 31,2014.Tarkenton's entry to record the sale of security Z would include a

Question

Tarkenton Corporation purchased the following portfolio of trading securities during 2014 and reported the following balances at December 31,2014.No sales occurred during 2014.All declines are considered to be temporary.  The only transaction in 2015 was the sale of security Z for $35,000 on December 31,2015.The market values for the other securities at December 31,2015,were the same as at December 31,2014.Tarkenton's entry to record the sale of security Z would include a

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When selling a trading security, any gain or loss is recorded in the Realized Gain or Loss on Sale of Trading Securities account. Since Tarkenton Corporation sold security Z for $35,000, which is $3,000 more than its original cost of $32,000, a credit of $32,000 would be made to the Trading Securities account to remove the cost of the security, and a credit of $3,000 would be made to the Realized Gain on Sale of Trading Securities account to record the gain. None of the other accounts listed would be affected by the sale, as the other securities did not change in value between 2014 and 2015.

Tarkenton Corporation Purchased the Following Portfolio of Trading Securities During