Assuming that the 35,000 shares represent a 10% interest in Pear Corporation, Prepare the journal entry to record the investment in Pear Corporation stock.

In order to record the investment in Pear Corporation stock, we must first calculate the purchase price. Since 35,000 shares represent 10% of Pear Corporation’s outstanding shares, this means that there are 350,000 total shares and therefore each share has a value of $1.

Next, we can prepare a journal entry to reflect this transaction:
Debit Cash $35,000
Credit Investment in Pear Corporation Stock $35,000

By recording this journal entry, it will show that an amount of cash was paid for the purchase of 35,000 shares of Pear Corporation stock and this asset is now added to our balance sheet under investment assets.