On December 31, 2017, Short-Term Equity Securities with an Original

question 29

Essay

On December 31, 2017, short-term equity securities with an original cost of $10,000 have a carrying value on the balance sheet equal to their market value of $12,000. On January 5, 2018, those securities are sold for $10,000. Give the appropriate entry to record the sale of the securities.

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Definitions:

Indirect Factory Wages

Wages paid to employees who are not directly involved in production but whose services are necessary for the manufacturing process.

Budgeted Amounts

Financial projections or estimates of revenue and expenses over a specified period, used for planning and control purposes.

Direct Labor Time Variance

The difference between the actual time taken to produce a good or service and the estimated time.

Standard Rate

A predetermined charge or cost that applies to a specific service, transaction, or product under typical conditions.