Stockholders Equity: Transactions and Balance Sheet Presentation

The stockholders equity accounts of Windham Corporation at January 1 appear below:

8 Percent preferred stock, $25 par value, 50,000 shares authorized;
6,800 shares issued and outstanding	$170,000
Common stock, $10 par value, 200,000 shares authorized;
50,000 shares issued and outstanding	500,000
Paid-in capital in excess of par value-Preferred stock	68,000
Paid-in capital in excess of par value-Common stock	200,000
Retained earnings	270,000

During the year, the following transactions occurred:

Jan.	10	Issued 28,000 shares of common stock for $18 cash per share.
	23	Purchased 8,000 shares of common stock as treasury stock at $20 per share.
Mar.	14	Sold one-half of the treasury shares acquired January 23 for $22 per share.
July	15	Issued 3,200 shares of preferred stock in exchange for equipment with a fair market value of $128,000.
Nov.	15	Sold 1,000 of the treasury shares acquired January 23 for $25 per share.
Dec.	31	Closed the net income of $60,000 to the Retained Earnings account.

Required

a. Set up T-accounts for the stockholders equity accounts as of the beginning of the year and enter the January 1 balances.

HINT: Complete part b. below prior to entering T-account data. b. Prepare journal entries to record the foregoing transactions and post to T-accounts above in part a. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders equity accounts.

c. Prepare the December 31 stockholders equity section of the balance sheet.

Do not use negative signs with your answers.

Cash Jan.10 Jan.23 Mar.14 Nov.15 Bal Preferred Stock Beg. Jul.15 Bal Common Stockk Beg. Jan.10 Bal Equipment Jul.15 0 Bal 0