Beamsley Corporation was organized in 2017 to operate a financial consulting business. The charter authorized 12,000 common

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Beamsley Corporation was organized in 2017 to operate a financial consulting business. The charter authorized 12,000 common shares, no par value. During the first year, the following selected transactions were completed:

a. Issued 6,000 shares of common shares for cash at $20 per share.

b. Issued 2,000 shares of common shares for cash at $23 per share.


Required:

1. Show the effects of each transaction on the accounting equation.

2. Give the journal entry required for each of these transactions.

3. Prepare the shareholders’ equity section as it should be reported on the 2017 year-end balance sheet. At year-end, the accounts reflected a profit of $100.

4. Beamsley Corporation has $30,000 in the company’s bank account. Should the company declare cash dividends at this time? Explain.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Fundamentals of Financial Accounting

ISBN: 978-1259269868

5th Canadian edition

Authors: Fred Phillips, Robert Libby, Patricia Libby, Brandy Mackintosh

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