3.
Tony and Suzie have purchased land for a new camp. Now they need money to build the cabins, dining facility, a ropes course, and an outdoor swimming pool. Tony and Suzie first checked with Summit Bank to see if they could borrow an additional $1 million, but unfortunately the bank turned them down as too risky. Undeterred, they promoted their idea to close friends they had made through the outdoor clinics and TEAM events. They decided to go ahead and sell shares of stock in the company to raise the additional funds for the camp Great Adventures has authorized $1 par value common stock. When the company began on July 1, 2021, Tony and Suzie each purchased 10,000 shares (20,000 shares total) of $1 par value common stock at $1 per share. The following transactions affect stockholders' equity during the remainder of 2022: November 5 Issue an additional 100,000 shares of common stock for $10 per share November 16 Purchase 10,000 shares of its own common stock (i.e., treasury stock) for $15 per share. November 24 Resell 4,000 shares of treasury stock at $16 per share. December 1 Declare a cash dividend on its common stock of $11,400 ($0.10 per share) to all stockholders of record on December 15 December 20 Pay the cash dividend declared on December 1. December 31 Pay $800,000 for construction of new cabins and other facilities. The entire expenditure is recorded in the Buildings account. Required 1. Record each of these transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 2. Great Adventures has net income of $35,835 in 2022. Retained earnings at the beginning of 2022 was $33,450. Prepare the stockholders' equity section of the balance sheet for Great Adventures as of December 31, 2022. (Amounts to be deducted should be indicated with a minus sign.) GREAT ADVENTURES, INC Balance Sheet (Stockholders' Equity Section) December 31, 2022 Stockholders' equity Common Stock Additional Paid-In Capital Total paid-in capital Retained Earnings Treasury Stock Total stockholders' equity Nautical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the beginning of 2021, 125 shares of preferred stock and 3,000 shares of common stock have been issued. The following transactions affect stockholders' equity during 2021: March 1 Issue 3,eee additional shares of common stock for $1e per share April 1 Issue 175 additional shares of preferred stock for $40 per share. e eme ash dividend on both common and preferred stock of so.25 per share to all stockholders of record on June 15 June 30 Pay the cash dividends declared on June 1. August 1 Purchase 175 shares of common treasury stock for $7 per share. October 1 Resell 125 shares of treasury stock purchased on August 1 for $9 per share Nautical has the following beginning balances in its stockholders' equity accounts on January 1, 2021: Preferred Stock, $1,250: Common Stock, $3,000; Additional Paid-in Capital, $19,500; and Retained Earnings, $11,500. Net income for the year ended December 31, 2021, is $7650. Required 1. Record each of these transactions. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 2. Select whether each of the following transactions increases (+)or decreases(-) total assets, total liabilities, and total stockholders' equity. (If none of the categories apply for a particular item, leave the cell blank.) Total Total Assets Liabilities Stockholders Total Transaction Equity Issue common stock Issue preferred stock Declare cash dividends Pay cash dividends Purchase treasury stock Resell treasury stock
