Buffalo Corporation made the following cash purchases of securities during 2025, which is the first year in which Buffalo invested in securities. 1. On January 15, purchased 9,200 shares of Sanchez Company's common stock at $33.50 per share plus commission $1,824. 2. On April 1, purchased 4,600 shares of Vicario Co's common stock at $52.00 per share plus commission $3,098. 3. On September 10, purchased 6,440 shares of WTA Co's preferred stock at $26.50 per share plus commission $4,516. On May 20, 2025, Buffalo sold 3,588 shares of Sanchez Company's common stock at a market price of $35 per share less brokerage commissions, taxes, and fees of $3,542. The year-end fair values per share were Sanchez $30, Vicario $55, and WTA $28. In addition, the chief accountant of Buffalo told you that the corporation plans to hold these securities for the long-term but may sell them in order to earn profits from appreciation in prices. The equity method of accounting is not appropriate for these stock purchases. (a) Prepare the journal entries to record the above three security purchases. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to O decimal places, e.g. 1,225.) No. Date (1) (2) (3) Account Titles and Explanation Debit C
Buffalo Corporation made the following cash purchases of securities during 2025, which is the first year in which Buffalo invested in securities. 1. On January 15, purchased 9,200 shares of Sanchez Company's common stock at $33.50 per share plus commission $1,824. 2. On April 1, purchased 4,600 shares of Vicario Co's common stock at $52.00 per share plus commission $3,098. 3. On September 10, purchased 6,440 shares of WTA Co's preferred stock at $26.50 per share plus commission $4,516. On May 20, 2025, Buffalo sold 3,588 shares of Sanchez Company's common stock at a market price of $35 per share less brokerage commissions, taxes, and fees of $3,542. The year-end fair values per share were Sanchez $30, Vicario $55, and WTA $28. In addition, the chief accountant of Buffalo told you that the corporation plans to hold these securities for the long-term but may sell them in order to earn profits from appreciation in prices. The equity method of accounting is not appropriate for these stock purchases. (a) Prepare the journal entries to record the above three security purchases. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to O decimal places, e.g. 1,225.) No. Date (1) (2) (3) Account Titles and Explanation Debit C
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Buffalo Corporation made the following cash purchases of securities during 2025, which is the first year in which Buffalo invested in
securities.
1. On January 15, purchased 9,200 shares of Sanchez Company's common stock at $33.50 per share plus commission $1,824.
2. On April 1, purchased 4,600 shares of Vicario Co's common stock at $52.00 per share plus commission $3,098.
3. On September 10, purchased 6,440 shares of WTA Co's preferred stock at $26.50 per share plus commission $4,516.
On May 20, 2025, Buffalo sold 3,588 shares of Sanchez Company's common stock at a market price of $35 per share less brokerage
commissions, taxes, and fees of $3,542. The year-end fair values per share were Sanchez $30, Vicario $55, and WTA $28. In addition,
the chief accountant of Buffalo told you that the corporation plans to hold these securities for the long-term but may sell them in
order to earn profits from appreciation in prices. The equity method of accounting is not appropriate for these stock purchases.
(a)
Prepare the journal entries to record the above three security purchases. (List all debit entries before credit entries. Credit account
titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account
titles and enter O for the amounts. Round answers to O decimal places, e.g. 1,225.)
No.
Date
(1)
(2)
(3)
Account Titles and Explanation
Debit
C
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