Lessington Corporation Purchases 4,000 Shares of Gonzalez Company Common Stock

Multiple Choice

Lessington Corporation purchases 4,000 shares of Gonzalez Company common stock for $150,000 as a long-term investment. The investment is classified as available-for-sale securities. Gonzalez has 500,000 shares of stock currently outstanding and the par value of the stock is $1 per share. Lessington's entry to record the purchase transaction would include a:

A) Credit to Common Stock for $4,000.
B) Credit to Common Stock for $150,000.
C) Debit to Long-Term Investments-AFS for $4,000.
D) Credit Gain on Long-Term Investment $146,000.
E) Debit to Long-Term Investments-AFS for $150,000.