Question
Nav-Go Enterprises Inc. produces aeronautical navigation equipment. Nav-Go Enterprises' stockholders equity accounts, with balances on January 1, 20Y1, are as follows: Common Stock, $10 stated
Nav-Go Enterprises Inc. produces aeronautical navigation equipment. Nav-Go Enterprises' stockholders equity accounts, with balances on January 1, 20Y1, are as follows:
Common Stock, $10 stated value (900,000 shares authorized, 600,000 shares issued) | $6,000,000 |
Paid-In Capital in Excess of Stated Value-Common Stock | 1,150,000 |
Retained Earnings | 13,620,000 |
Treasury Stock (60,000 shares, at cost) | 840,000 |
The following selected transactions occurred during the year:
Jan. 15. | Paid cash dividends of $0.13 per share on the common stock. The dividend had been properly recorded when declared on December 1 of the preceding fiscal year for $70,200. |
Mar. 15. | Sold all of the treasury stock for $17 per share. |
Apr. 13. | Issued 115,000 shares of common stock for $1,840,000. |
June 14. | Declared a 4% stock dividend on common stock, to be capitalized at the market price of the stock, which is $18 per share. |
July 16. | Issued shares of stock for the stock dividend declared on June 14. |
Oct. 30. | Purchased 38,000 shares of treasury stock for $19 per share. |
Dec. 30. | Declared a $0.16-per-share dividend on common stock. |
31. | Closed the two dividends accounts to Retained Earnings. |
Required:
1. The January 1 balances have been entered in T accounts for the stockholders' equity accounts. Record the above transactions in the T accounts and provide the December 31 balance where appropriate. If required, round to one decimal place.
Common Stock | |||
---|---|---|---|
Jan. 1 Bal. | 6,000,000 | ||
Apr. 13June 14July 16Dec. 27Apr. 13 | |||
Jan. 22June 14July 16Dec. 30July 16 | |||
Dec. 31 Bal. |
Paid-In Capital in Excess of Stated Value-Common Stock | |||
---|---|---|---|
Jan. 1 Bal. | 1,150,000 | ||
Apr. 13June 14July 16Dec. 30Apr. 13 | fill in the blank 7 | ||
June 14July 16July 16Dec. 30June 14 | fill in the blank 9 | ||
Dec. 31 Bal. | fill in the blank 10 |
Retained Earnings | |||
---|---|---|---|
Apr. 13June 14July 16Dec. 31Dec. 31 | Jan. 1 Bal. | 13,620,000 | |
Jan. 22June 14Oct. 30Dec. 31Dec. 31 |
Treasury Stock | |||
---|---|---|---|
Jan. 1 Bal. | 840,000 | Apr. 13Mar. 15July 16Dec. 31 | fill in the blank 17 |
Jan. 22June 14Oct. 30Dec. 31 | |||
Dec. 31 Bal. |
Paid-In Capital from Sale of Treasury Stock | |||
---|---|---|---|
Mar. 15June 14Oct. 30Dec. 30 | fill in the blank 22 |
Stock Dividends Distributable | |||
---|---|---|---|
Jan. 22July 16Oct. 30Dec. 31 | Jan. 22June 14Oct. 30Dec. 31 |
Stock Dividends | |||
---|---|---|---|
Jan. 22June 14Oct. 30Dec. 31 | Jan. 22July 16Oct. 30Dec. 31 |
Cash Dividends | |||
---|---|---|---|
Jan. 22July 16Oct. 30Dec. 30 | Jan. 22July 16Oct. 30Dec. 31 |
2. Journalize the entries to record the transactions. For a compound transaction, if an amount box does not require an entry, leave it blank.
Jan. 15. Paid cash dividends of $0.13 per share on the common stock. The dividend had been properly recorded when declared on December 1 of the preceding fiscal year for $70,200.
Date | Account | Debit | Credit |
---|---|---|---|
Jan. 15 | CashCash DividendsCash Dividends PayableCommon StockStock Dividends Distributable | ||
CashCash DividendsCash Dividends PayableCommon StockStock Dividends |
Mar. 15. Sold all of the treasury stock for $17 per share.
Date | Account | Debit | Credit |
---|---|---|---|
Mar. 15 | CashCommon StockPaid-In Capital in Excess of Stated Value-Common StockRetained EarningsTreasury Stock | ||
CashCommon StockPaid-In Capital in Excess of Stated Value-Common StockRetained EarningsTreasury Stock | |||
Common StockPaid-In Capital from Sale of Treasury StockPreferred StockRetained EarningsStock Dividends Distributable |
Apr. 13. Issued 115,000 shares of common stock for $1,840,000
Date | Account | Debit | Credit |
---|---|---|---|
Apr. 13 | CashCommon StockPaid-In Capital from Sale of Treasury StockPaid-In Capital in Excess of Stated Value-Common StockTreasury Stock | ||
CashCash DividendsCommon StockStock DividendsTreasury Stock | |||
CashCash Dividends PayablePaid-In Capital from Sale of Treasury StockPaid-In Capital in Excess of Stated Value-Common StockPreferred Stock |
June 14. Declared a 4% on common stock, to be capitalized at the market price of the stock, which is $18 per share.
Date | Account | Debit | Credit |
---|---|---|---|
June 14 | CashCommon StockPaid-In Capital in Excess of Stated Value-Common StockStock DividendsStock Dividends Distributable | ||
CashCommon StockPaid-in Capital from Sale of Treasury StockStock Dividends DistributableTreasury Stock | |||
CashCash DividendsPaid-In Capital in Excess of Stated Value-Common StockStock DividendsTreasury Stock |
July 16. Issued stock for stock dividend declared on June 14.
Date | Account | Debit | Credit |
---|---|---|---|
July 16 | CashCash Dividends PayableCommon StockStock DividendsStock Dividends Distributable | ||
CashCash Dividends PayableCommon StockStock DividendsStock Dividends Distributable |
Oct. 30. Purchased 38,000 shares of treasury stock for $19 per share.
Date | Account | Debit | Credit |
---|---|---|---|
Oct. 30 | CashCommon StockPaid-In Capital from Sale of Treasury StockStock DividendsTreasury Stock | ||
CashCommon StockPaid-In Capital from Sale of Treasury StockStock Dividends DistributableTreasury Stock |
Dec. 30. Declared a $0.16-per-share dividend on common stock.
Date | Account | Debit | Credit |
---|---|---|---|
Dec. 30 | CashCash DividendsCash Dividends PayableCommon StockTreasury Stock | ||
CashCash Dividends PayableCommon StockStock DividendsStock Dividends Distributable |
Dec. 31. Closed the two dividends accounts to Retained Earnings.
Date | Account | Debit | Credit |
---|---|---|---|
Dec. 31 | CashCash DividendsRetained EarningsStock DividendsStock Dividends Distributable | ||
CashCommon StockRetained EarningsStock DividendsStock Dividends Distributable | |||
CashCash DividendsIncome SummaryRetained EarningsTreasury Stock |
3. Prepare a statement of stockholders equity for the year ended December 31, 20Y1. Assume that net income was $14,165,000 for the year ended December 31, 20Y1. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If an amount box does not require an entry, leave it blank or enter 0.
Nav-Go Enterprises Inc. Statement of Stockholders Equity For the Year Ended December 31, 20Y1 | ||||||
---|---|---|---|---|---|---|
Common Stock | Paid-In Capital in Excess of Stated Value | Paid-In Capital from Sale of Treasury Stock | Retained Earnings | Treasury Stock | Total | |
4. Prepare the Stockholders Equity section of the December 31, 20Y1, balance sheet. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
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