Question
Riverbed Corporation is authorized to issue an unlimited number of $5 cumulative preferred shares and an unlimited number of common shares. On February 1, 2020,
Riverbed Corporation is authorized to issue an unlimited number of $5 cumulative preferred shares and an unlimited number of common shares. On February 1, 2020, the general ledger contained the following shareholders' equity accounts:
Preferred shares (10,000 shares issued) | $460,000 | ||
Common shares (72,000 shares issued) | 1,224,000 | ||
Retained earnings | 799,000 |
The following equity transactions occurred during the year ended January 31, 2021:
Feb. | 28 | Issued 5,500 preferred shares for $319,000. | |
Apr. | 12 | Issued 210,000 common shares for $3.78 million. | |
May | 25 | Issued 5,500 common shares in exchange for land. At the time of the exchange, the land was valued at $93,500. | |
Jan. | 1 | Paid dividend of $2.50 per share to preferred shareholders. | |
Jan. | 31 | A loss of $43,000 was incurred for the year. |
(a)
Correct answer iconYour answer is correct.
Journalize the transactions and the entries to close dividends and the Income Summary account. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)
Date | Account Titles and Explanation | Debit | Credit |
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To record issuance of shares.) | |||
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To record issuance of shares.) | |||
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To record issuance of shares.) | |||
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To record declaration and payment of dividend.) | |||
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To close Income Summary.) | |||
Feb. 28Apr. 12May 25Jan. 1Jan. 31 | |||
(To close dividends.) |
eTextbook and Media
List of Accounts
Attempts: 2 of 5 used
(b)
Open general ledger accounts for the shareholders' equity accounts and post entries from previous part. (Post entries in the order of Journal entry presented in the previous part (a).)
Preferred Shares | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Feb. 1 | Balance | ||||
Feb. 28 | J1 | ||||
Common Shares | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Feb. 1 | Balance | ||||
Apr. 12 | J1 | ||||
May 25 | J1 | ||||
Cash DividendsPreferred | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Jan. 1 | J1 | ||||
Jan. 31 | Closing entry | J1 | |||
Retained Earnings | |||||
Date | Explanation | Ref. | Debit | Credit | Balance |
Feb. 1 | Balance | ||||
Jan. 31 | Closing Entry | J1 | |||
Jan. 31 | Closing Entry | J1 |
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