Nicole has been financing Nicoles Getaway Spa (NGS) using equity financing. Currently NGS has authorized 100,000 no-par preferred shares and 200,000 $2 par common shares. Outstanding shares include 54,000 preferred shares and 44,000 common shares.

Recently the following transactions have taken place.

a.

NGS issues 1,200 preferred shares for $11 a share.

b.

NGS repurchases 1,200 common shares for $10 a share.

c.

On November 12, the board of directors declares a $0.50 cash dividend on each outstanding preferred share.

d.

The dividend is paid December 20.

Required:
1.	Prepare the journal entries needed for each of the transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

a. Record the issuance of 1,200 shares of preferred stock with no par value for a price of $11 per share.

b. Record the purchase of 1,200 previously issued common shares for a price of $10 per share.

c. Record the declaration of a $0.50 cash dividend on the shares of preferred stock outstanding.

d. Record the payment of the cash dividend to the preferred shareholders.

3. Show the overall effect of each transaction on the assets, liabilities, and shareholders' equity of the company. (Use + for increase,-for decrease.) (Leave cell blank if there is no effect.) Balance Sheet Transaction Stockholders Equity Assets Liabilities a. b. C. d