Question 2 Sunland Company is authorized to issue 10000 shares of 8%, $100 par v

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Question 2

Sunland Company is authorized to issue 10000 shares of 8%, $100 par value preferred stock and 505000 shares of no-par common stock with a stated value of $1 per share. If Sunland issues 5000 shares of preferred stock for land with an asking price of $586000 and a market value of $550000, which of the following would be the journal entry for Sunland to record?

Question 1

Swifty Corp. issues 1100 shares of $10 par value common stock at $15 per share. When the transaction is recorded, credits are made to

Common Stock $11000 and Retained Earnings $5500.

Question 3

Bonita Corporation’s December 31, 2017 balance sheet showed the following:

Bonita declared and paid a $58300 cash dividend on December 15, 2017. If the company’s dividends in arrears prior to that date were $10200, Bonita’s common stockholders received

Land 550000    Preferred Stock 500000    Paid-in Capital in Excess of Par-Preferred 50000

Explanation / Answer

Solution 2 Correct answer is = Land (Market Value) $ 5,50,000 Preffered Stock $ 5,00,000 Paid-in capital in excess of Par-Prefferd $     50,000 Solution 1 Correct answer is = Common Stock $11,000 and paid in capital in excess of par $5,500 Common Stock = 1,100 X $10 = $11,000 paid in capital in excess of par = 1,100 X ($15-$10) = $5,500 Solution 3 Correct answer is = $ 36,200 Cash Dividend = $     58,300 Less: Dividend Pyable on authorised shares (8,500 X $20 X 7%) = $     11,900 Less: Dividend in arrears = $     10,200 Bonitaz Common stockholder's received = $     36,200

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