FAME Corporation is authorized to issue 1,000,000 shares of S1 par value common stock, and 200,000 shares of 10%, S 5 par value preferred Stock. During 2019, the company has the following stock transactions Entry 1 Issued 400.000 common shares of stock at S3 cash per share. Entry 2 Issued 30.000 preferred shares to purchase a land advertised for sale at S 300,000. On this day, the preferred stock had a market price of S 9 per share. Entry 3 Purchased 10,000 of its common shares from the market for the treasury, when the market price per common share was $4. Entry 4 Sold 2.000 shares of its treasury stock for S 6 per share. Entry 5 Issued 10.000 preferred shares for cash, at 10 per share. Entry 6 Sold 3,000 shares of treasury stock for S 3 per share. Entry 7 The Board of Directors declared a total cash dividends of S 80,000 for all shareholders on record, as of 25 December, 2019 (both preferred and common). Dividends will be paid on 30 December, 2019. Answer the following with True or False: Total number of swed e n shares of your and is 395,000 share 2 In entry #1. Common stock account will be credited for $400.000 3 In entry 12, Land account will be debited for $300.000 4 In entry 3. Commen ockcount will be debited for $40,000 5 Afler entry #3, the total outstanding c h anesis 390,000 share 6 In entry #4, the account Paid in capital is excess from Treasury Stock Transactions will be credited SS 4000 7 In entry 5, Preferred to co l lected for $50,000 & After entry 6, the account Paid in capital is free Treasury Stock Transactions will have a deithallenge of 1.000 9 After entry # 6, the number of outstanding shares of common stocks is 10 In entry 7, the account Cash Dhide will be credited for 50 000 11 On December 25, try to confirm the apoal of the board to pay the cash dividends is needed by the company 12 Commee shareholders will be paid a wall of 60.000 cash dividends 13 All common shares issued will be paid cash dividends on December 30, 14 In the entry done on December 2019, Cash dividends will be debited for $80,000 Is if the Retained Earnings account had a c h ance of $ 220000 after the payment of dividends and closing the met income for the year. Ion December 31, 2019, the total stockholders quity for the company will be $ 1.791.000 FAME Corporation is authorized to issue 1,000,000 shares of $1 par value common stock, and 200,000 shares of 10%, $ 5 par value preferred Stock. During 2019, the company has the following stock transactions. Entry 1 Issued 400,000 common shares of stock at $3 cash per share. Entry 2 Issued 30,000 preferred shares to purchase a land advertised for sale at $ 300,000. On this day, the preferred stock had a market price of $ 9 per share. Entry 3 Purchased 10,000 of its common shares from the market for the treasury, when the market price per common share was $ 4. Entry 4 Sold 2,000 shares of its treasury stock for $ 6 per share. Entry 5 Issued 10,000 preferred shares for cash, at 10 per share. Entry 6 Sold 3,000 shares of treasury stock for $ 3 per share. 7 The Board of Directors declared a total cash dividends of $ 80,000 for all shareholders on record, as of 25 December, 2019 (both preferred and common). Dividends will be paid on 30 December, 2019. Answer the following with True or False: Item Answer (T/F) Total number of issued common shares at year end is 395,000 share. 2 In entry # 1, Common stock account will be credited for $ 400,000. 3 In entry #2, Land account will be debited for $ 300,000. 4 In entry #3, Common stock account will be debited for $ 40,000. 5 After entry #3, the total outstanding common shares is 390,000 share. 6 In entry # 4, the account Paid in capital in excess from Treasury Stock Transactions will be credited for $4,000. 7 In entry # 5, Preferred stocks account will be credited for $50,000. 8 After entry #6, the account Paid in capital in excess from Treasury Stock Transactions will have a debit balance of $ 1,000. 9 After entry #6, the number of outstanding shares of common stocks is 394,000. 10 In entry # 7, the account Cash Dividends will be credited for $ 80.000 11 On December 25, no entry to confirm the approval of the board to pay the cash dividends is needed by the company. 12 Common shareholders will be paid a total of $ 60,000 as cash dividends 13 All common shares issued will be paid cash dividends on December 30, 2019. 14 In the entry done on December 30,2019, the account Cash dividends will be debited for $ 80,000. 15 If the Retained Earnings account had a credit balance of $ 220,000, after the payment of dividends and closing the net income for the year, (on December 31, 2019), the total stockholders equity for the company will be $ 1,791,000
