1. Weighted-Average Shares Outstanding

On January 1, 2022, Carr Company had 600,000 shares of $10 par common stock outstanding. During 2022, Carr had the following transactions that affected the common stock account.

February 1 Issued 200,000 shares

May 1 Issued a 10% stock dividend

July 1 Acquired 60,000 shares of treasury stock

October 1 Reissued 20,000 shares of treasury stock

November 1 Issued a 2-for1 stock split

Instructions:

Compute the weighted-average number of common stock shares outstanding as of December 31, 2022.

2. Lump Sum Sale of Common Stock with Preferred Stock

Higley Company issues 5,000 shares of $10 par common stock and 2,000 shares of $100 par preferred stock for $620,000.

Instructions:

(a) Prepare the journal entry for the issuance when the market price of the common stock is $80 per share and the market price of the preferred stock is $120 per share.

(b) Prepare the journal entry for the issuance when only the market price of the common stock is known and it is $65 per share.