Question
On January 2, 2016, ABC Corporation applied for and was granted, by the Minnesota Secretary of State, incorporation and the right to issue: 5,000 shares
On January 2, 2016, ABC Corporation applied for and was granted, by the Minnesota Secretary of State, incorporation and the right to issue:
5,000 shares of $100 par, 8% cumulative nonparticipating preferred stock
50,000 shares of $1 par common stock
Note: ABCs policy for accounting for treasury stock is to use the cost method.
Using the attached T-account template, prepare the required entries for the following economic events.
1/11/16 Issued 20,000 shares of common stock at $16 per share
2/1/16 Issued to ZZZ Corporation 4,000 shares of preferred stock in exchange for the following assets:
Equipment with a fair value of $50,000
Factory Building with a fair value of $160,000
Land with an appraised value of $270,000
7/29/16 Purchased 1,800 shares of its own common stock at $17 per share
8/10/16 Sold the 1,800 treasury shares at $14 per share
12/31/16 The board of directors declared a $ 0.25 per share cash dividend on the common stock and declared the preferred dividend.
12/31/16 Closed the Income Summary account. The balance in the Income Summary account totaled $175,700 and represented net income.
Prepare the stockholders equity section of the balance sheet of ABC Corporation at 12/31/16.
XYZ Corporations articles of incorporation & charter granted by the Minnesota Secretary of State authorize issuance of
100,000 shares of $10 par common stock
50,000 shares of $50 par 6% preferred stock
Using the attached T-account template, prepare the required entries for the following independent transactions.
Issued 500 shares of common stock in exchange for equipment. The equipment was appraised at $7,100; the sellers book value (cost less accumulated depreciation) was $6,200. The most recent market price of the common stock is $16 per share.
Issued 375 shares of common and 100 shares of preferred for a lump sum of $10,800. The common recently sold for $14 per share and the preferred at $65 per share both in active markets.
The following condensed balance sheet information has been prepared by the controller of
N2N2 Company | ||
Balance Sheet | ||
December 31, 2016 | ||
Assets | ||
Current assets | $ 40,000 | |
Investments in equity securities (10,000 shares) | 60,000 | |
Equipment, net | 250,000 | |
Intangibles | 60,000 | |
Total Assets | 410,000 | |
Liabilities and Equity | ||
Current liabilities | 75,000 | |
Non-current liabilities | 25,000 | |
Common stock ($5 par) | 20,000 | |
Paid in capital in excess of par | 110,000 | |
Retained earnings | 180,000 | |
Total Liabilities and Equity | 410,000 | |
Using the attached T-account template, prepare the entries to recognize the following transactions.
Declares and pays a $ 0.50 per share cash dividend
Declares and issues a 10% stock dividend when the market price of the stock is $14 per share
Declares and issues a 30% stock dividend when the market price of the stock is $15 per share
Declares and issues a property dividend as follows. N2N2 gives one share of its investment in equity securities for every 2 shares that a N2N2 investor holds of N2N2 common stock. The equity investment shares are selling for $10 per share, in an active market, on the date the property dividend is declared by the board of directors.
Declares a 2 for 1 stock split and issues new shares to the stockholders
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