MotorCity, Inc

question 6

Multiple Choice

MotorCity, Inc. purchased 40,000 shares of Shaw common stock for $232,000. This represents 40% of the outstanding stock. The entry to record the transaction includes a:

• A) Debit to Short-Term Investment-AFS for $232,000.
• B) Debit to Long-Term Investments for $92,800.
• C) Debit to Long-Term Investments for $232,000.
• D) Debit to Long-Term Investments-HTM for $232,000.
• E) Credit to Long-Term Investments for $92,800.

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Definitions:

Degrees

A unit of measurement for angles or temperature.

Crossmembers

Horizontal structures that provide support and stability to the chassis or frame of a vehicle.

Torsional Forces

Forces causing an object to twist about an axis, leading to stress or strain within the object.

Chassis Sub-components

The various smaller parts or systems that together form the chassis of a vehicle, providing structural support to the vehicle's body.