Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Knapp Industries began business on January 1, 2018 by issuing all of its 1,600,000 authorized shares of its $2 par value common stock for $31

Knapp Industries began business on January 1, 2018 by issuing all of its 1,600,000 authorized shares of its $2 par value common stock for $31 per share. On June 30, Knapp declared a cash dividend of $1.50 per share to stockholders of record on July 31. Knapp paid the cash dividend on August 30. On November 1, Knapp reacquired 320,000 of its own shares of stock for $36 per share. On December 22, Knapp resold 160,000 of these shares for $42 per share.

Required:

  1. Prepare all of the necessary journal entries to record the events described above.
    1. Record the issue of 1,600,000 authorized shares of $2 par value for $31 per share.

    2. Record the declaration of the cash dividends of $1.50 per share.

    3. Record the payment of the cash dividends of $1.50 per share.

    4. Record the repurchase of 320,000 shares for $36 per share.

    5. Record the reissue of 160,000 share for 42 per share.

  2. Prepare the stockholders' equity section of the balance sheet as of December 31, 2018 assuming that the net income for the year was $8,500,000.image text in transcribedimage text in transcribedimage text in transcribed
Complete this question by entering your answers in the table below. Required A Required B Prepare all of the necessary journal entries to record the events described above. (If n "No Journal Entry Required" in the first account field.) View transaction list x A Record the issue of 1,600,000 authorized shares of $2 par value for $31 per share. 31 per B Record the declaration of the cash dividends of $1.50 per share. Record the payment of the cash dividends of $1.50 per share. Credit D Record the repurchase of 320,000 shares for $36 per share. E Record the reissue of 160,000 share for 42 per share. Moto. journalontracboonontored Required A Required B Prepare the stockholders' equity section of the balance sheet as of December 31, 2018 assuming that the net income for the year was $8,500,000. Knapp Industries Stockholders' Equity Balance Sheet as of December 31, 2018 0 Total Stockholders' Equilty Knapp Industries Stockholders' Equity Balance Sheet as of December 31, 2018 0 Tat aalbeldavalalt. dA Add: Treasury Stock Less: Treasury Stock

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Robert Libby, Patricia Libby, Frank Hodge

11th Edition

1264229739, 9781264229734

More Books

Students also viewed these Accounting questions

Question

10. What is meant by a feed rate?

Answered: 1 week ago