Question
[The following information applies to the questions displayed below.] Brice Co. completed the following transactions in Year 1, the first year of operation. Issued 44,000
[The following information applies to the questions displayed below.]
Brice Co. completed the following transactions in Year 1, the first year of operation.
- Issued 44,000 shares of no-par common stock for $10 per share.
- Issued 8,400 shares of $20 par, 8 percent, preferred stock for $20 per share.
- Paid a cash dividend of $13,440 to preferred shareholders.
- Issued a 10 percent stock dividend on no-par common stock. The market value at the dividend declaration date was $12 per share.
- Later that year, issued a 2-for-1 split on the shares of outstanding common stock. The market price of the stock at that time was $50 per share.
- Produced $160,000 of cash revenues and incurred $76,000 of cash operating expenses.
- Closed the revenue, expense, and dividend accounts to retained earnings.
Required a. Record each of these events in a horizontal statements model like the following one. (Enter amounts to be deducted and cash outflows with a minus sign. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Not all cells require input.)
b. Prepare the stockholders equity section of the balance sheet at the end of Year 1.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started