There are three comprehensive questions. One on the first tab, two on the second. Also placed into
Question:
There are three comprehensive questions. One on the first tab, two on the second. Also placed into the dialog box in case attachment is a problem.
Salisbury Corporation formed a corporation on January 3, 2016, and is authorized to issue 500,000 shares of $10 par value common stock. The company has the following stock transactions.
| 1/10/2016 ? Issued 200,000 shares of stock at $16 per share. 1/25/2016 ? The law firm that helped the company incorporate and file all forms for the stock issue accepts 1,000 shares of newly issued stock in lieu of cash for its legal bill rendered. The amount of the legal bill was $20,000. 6/10/2016 ? Salisbury Corporation declares a 50 cent per share dividend payable July 15 to shareholders of record as of June 30, 2016. 6/30/2016 ? The record date for the dividend declared on June 10. 7/15/2016 ? The dividend declared on June 10 is paid. 9/15/2016 ? Salisbury Corporation declares a 10% stock dividend payable on September 30 to shareholders of record as of September 20. The market value of the stock was $15 immediately prior to the declaration of the stock dividend. 9/30/2016 ? The stock dividend declared on September 15 is paid. 10/15/2016 ? Salisbury Corporation buys 5,000 shares of its own stock on the open market for $18 per share. 12/18/2016 ? Salisbury Corporation resells 2,000 shares of the treasury stock for $20 per share. #2 On January 2, 2016, Alpha Company purchased 25,000 shares of Bravo Company stock on the open market for $50 per share as a long-term investment. On both June 15 and December 15, Bravo Company paid $50,000 in dividends for a total annual dividend of $100,000. On December 31, Bravo Company reported net income of $400,000 and the stock had a market value of $75 per share. Both Alpha and Bravo operate on a calendar year. Part A ? Assume that at all times during the year there were 250,000 shares of Bravo Company stock outstanding.
Part B ? Assume that at all times during the year there were 100,000 shares of Bravo Company stock outstanding.
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1/10/2016 1/10/2016 - Issued 200,000 shares of stock at $16 per share. 1/25/2016 1/25/2016 - The law firm that helped the company incorporate and file all forms for the stock issue accepts 1,000 shares of newly issued stock in lieu of cash for its legal bill rendered. The amount of the legal bill was $20,000. 6/10/2016 6/10/2016 - Salisbury Corporation declares a 50 cent per share dividend payable July 15 to shareholders of record as of June 30, 2016. 6/30/2016 6/30/2016 - The record date for the dividend declared on June 10. 7/15/2016 7/15/2016 - The dividend declared on June 10 is paid. 9/15/2016 9/15/2016 - Salisbury Corporation declares a 10% stock dividend payable on September 30 to shareholders of record as of September 20. The market value of the stock was $15 immediately prior to the declaration of the stock dividend. 9/30/2016 9/30/2016 - The stock dividend declared on September 15 is paid. 10/15/2016 10/15/2016 - Salisbury Corporation buys 5,000 shares of its own stock on the open market for $18 per share. 12/18/2016 12/18/2016 - Salisbury Corporation resells 2,000 shares of the treasury stock for $20 per share. 1/10/2016 Account Cash Capital Stock price per share $16 1/25/2016 Debit Credit $ 3,200,000 $ 3,200,000 On January 2, 2016, Alpha Company purchased 25,000 shares of Bravo Company stock on the open market for $50 per share as a long-term investment. On both June 15 and December 15, Bravo Company paid $50,000 in dividends for a total annual dividend of $100,000. On December 31, Bravo Company reported net income of $400,000 and the stock had a market value of $75 per share. Both Alpha and Bravo operate on a calendar Part A - Assume that at all times during the year there were 250,000 shares of Bravo Company stock outstanding. Record the journal entries for the purchase of the stock, the dividends, and the reporting of income at year end on Alpha Company books. State what the year-end value of the stock investment account is on the Alpha Company books. Part B - Assume that at all times during the year there were 100,000 shares of Bravo Company stock outstanding. Record the journal entries for the purchase of the stock, the dividends, and the reporting of income at year end on Alpha Company books. State what the year-end value of the stock investment account is on the Alpha Company books. dar year Expert Answer:
