During December 2018, Apartment Publishing sold 2,500 12-month annual magazine subscriptions at a rate of $20 each. The first issues were mailed in January 2019.

Required:

(a)Prepare the entry in December 2018 for the receipt of the subscriptions.

(b) Prepare the adjusting entry at January 2019.,'' the mailing of the first issues''.

The stockholders equity section of Fauberg Marigny Corporation at December 31 is as follows.

FAUBERG MARIGNY CORPORATION

Balance Sheet (partial)

Paid-in capital

Preferred stock, cumulative, 10,000 shares authorized,

5,000 shares issued and outstanding $ 300,000

Common Stock, no par, 750,000 shares authorized, 300,000 shares issued 1,500,000

Total paid-in capital 1,800,000

Retained earnings 2,050,000

Total paid-in capital and retained earnings 3,850,000

Less: Treasury stock (5,000 common shares 64,000

Total stockholders' equity $3,786,000

Instructions

From a review of the stockholders equity section, answer the following questions.

(a) How many shares of common stock are outstanding?

(b) Assuming there is a stated value, what is the stated value of the common stock?

(c) What is the par value of the preferred stock?

(d) If the annual dividend on preferred stock is $18,000, what is the dividend rate on preferred stock?

(e) If dividends of $36,000 were in arrears on preferred stock, what would be the balance in Retained Earnings?