Question 1

On January 5, 2020, Oriole Corporation received a charter granting the right to issue4,800shares of $100par value,8% cumulative and nonparticipating preferred stock, and49,300shares of $10par value common stock. It then completed these transactions.

Jan. 11Issued20,400shares of common stock at $16per share.Feb. 1Issued to Sanchez Corp.4,000shares of preferred stock for the following assets: equipment with a fair value of $52,700; a factory building with a fair value of $175,000; and land with an appraised value of $292,000.July 29Purchased1,800shares of common stock at $16per share. (Use cost method.)Aug. 10Sold the1,800treasury shares at $13per share.Dec. 31Declared a $0.50per share cash dividend on the common stock and declared the preferred dividend.Dec. 31Closed the Income Summary account. There was a $190,000net income.