Entries for selected corporate transactions Instructions Chart of Accounts Journal Instructions Selected transactions completed by Primo Discount Corporation during the current fiscal year are as follows: Jan. 9 Feb. 28 Split the common stock 3 for 1 and reduced the par from $75 to $25 per share. After the split, there were 1,200,000 common shares outstanding. Purchased 40,000 shares of the corporation's own common stock at $28, recording the stock at cost. Declared semiannual dividends of $0.80 per share on 75,000 shares of preferred stock and $0.12 per share on the common stock to stockholders of record on June 1, payable on July 10. May 1 Jul. 10 Paid the cash dividends Sep 7 Oct. 1 Sold 30,000 shares of treasury stock at $34, receiving cash. Declared semiannual dividends of $0.80 per share on the preferred stock and $0.12 per share on the common stock (before the stock dividend). In addition, a 2% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $36. Paid the cash dividends and issued the certificates for the common stock dividend. Dec 1 Journalize the transactions. If no entry is required, simply skip to the next transaction. Refer to the Chart of Accounts for exact wording of account titles. Journal Shaded cells have feedback. Journalize the transactions. If no entry is required, simply skip to the next transaction. Refer to the Chart of Accounts for exact wording of account titles. All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback. PAGE 10 JOURNAL Score: 138/225 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Jan. 9 2 3 4 199,200.00 1 Cash Dividends Payable Cash 5 199,200.00 1 6 Sep.3 Cash 1,020,000.00 7 180,000.00 Paid-In Capital from Sale of Treasury Stock Treasury Stock 8 840,000.00 9 Oct. 1 Preferred Stock 60,000.00 1 10 139,200.00 + 11 199,200.00 * 12 835,200.00 1 Common Stock Cash Dividends Payable Oct. 1 Retained Earnings Stock Dividends Distributable Paid-In Capital in Excess of Par-Preferred Stock Dec. 1 Cash Dividends Payable 13 580,000.00 255,000.00 14 15 199,200.00 16 Cash 199,200.00 Journal Shaded cells have feedback. X 13 580,000.00 14 255,000.00 1 15 199,200.00 1 Stock Dividends Distributable Paid-In Capital in Excess of Par-Preferred Stock Dec. 1 Cash Dividends Payable Cash Dec. 1 Stock Dividends Distributable Common Stock 16 199,200.00 1 17 580,000.00 + 18 580,000.00 Points: 26.99 / 44 Feedback Check My Work Jan. 9: Review the effect of stock splits on equity accounts. Feb. 28: The purchase of treasury stock is typically recorded using the cost method. When the company resells shares of treasury stock pay attention to the price these shares are being sold for and the price originally paid to reacquire these shares. May 1: On the date of declaration of a cash dividend, the corporation is legally obligated to pay that dividend. When the company declares a cash or stock dividend keep in mind the previous stock transactions that have occurred; would these transactions have any affect on the amount of the cash dividend? Oct. 1: Recall that a stock dividend affects only stockholders' equity