Answer:
The journal entries are as follows:
(i) On February 1,
Stock investment A/c (500 × 32) Dr. $16,000
To cash $16,000
(To record share purchase)
(ii) On March 20,
Cash A/c Dr. $2,900
Loss on sale of stock investment A/c Dr. $300
To stock investment [16,000 × (100 ÷ 500)] $3,200
(To record share sale)
(iii) On April 25,
Cash A/c (500 - 100) Dr. $400
To dividend revenue $400
(To record receipt of dividend)
(iv) On June 15,
Cash A/c Dr. $7,600
To Gain on sale of stock investment $1,200
To stock investment [16,000 × (200 ÷ 500)] $6,400
(To record share sale)
(v) On July 28,
Cash A/c[(500 - 100 - 200) × 1.25] Dr. $250
To dividend revenue $250
(To record receipt of dividend)