Purdue Company Had the Following Transactions Pertaining to Stock Investments

Multiple Choice

Purdue Company had the following transactions pertaining to stock investments: a.February 1,Purchased 3,000 shares of Hudson Company (10% ownership) at the market price of $17 per share.Purdue Company intends to keep the stock for more than one year and classifies the stock as available-for-sale.
B.June 1,Received cash dividends of $6,000 on Hudson Company stock.
C.October 1,Sold 3,000 shares of Hudson stock for $54,000.
The journal entry to record the purchase of the Hudson stock is:

A) debit Equity-Method Investment for $51,000 and credit Cash for $51,000.
B) debit Investment in Available-for-Sale Securities for $51,000 and credit Cash for $51,000.
C) debit Cash for $51,000 and credit Common Stock for $51,000.
D) debit Common Stock for $51,000 and credit Cash for $51,000.