The stockholders’ equity accounts of Swifty Corporation on January 1, 2017, were

Question

The stockholders’ equity accounts of Swifty Corporation on January 1, 2017, were as follows.

Treasury Stock (4,100 common shares)

32,800

Preferred Stock (8%, $100 par noncumulative, 4,100 shares authorized) $246,000 Common Stock ($4 stated value, 331,000 shares authorized) 1,103,333 Paid-in Capital in Excess of Par Value—Preferred Stock 12,300 Paid-in Capital in Excess of Stated Value—Common Stock 529,600 Retained Earnings 689,000

Treasury Stock (4,100 common shares)

32,800

Problem 11-2A The stockholders' equity accounts of Swifty Corporation on January 1, 2017, were as follows. Preferred Stock (8%, $100 par noncumulative, 4,100 shares authorized) Common Stock ($4 stated value, 331,000 shares authorized1,103,333 Paid-in Capital in Excess of Par Value-Preferred Stock Paid-in Capital in Excess of Stated Value Common Stock Retained Earnings Treasury Stock (4,100 common shares) $246,000 12,300 529,600 689,000 32,800 During 2017, the corporation had the following transactions and events pertaining to its stockholders' equity Feb. 1 Mar. 20 Oct. 1 Nov. 1 Dec. 1 Dec. 31 Issued 5,020 shares of common stock for $35,140 Purchased 1,800 additional shares of common treasury stock at $7 per share. Declared a 8% cash dividend on preferred stock, payable November 1. Paid the dividend declared on October 1 Declared a $0.85 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017. Determined that net income for the year was $275,600. Paid the dividend declared on December 1

Explanation / Answer

Solution 1:

Solution 2:

Solution 3:

Journal Entries Date Particulars Debit Credit 1-Feb Cash Dr $35,140          To Common stock (5020*$4) $20,080          To Paid-in Capital in Excess of Stated Value—Common Stock    $15,060 (Being 5020 shares of common stock issued for $35140) 20-Mar Treasury Stock Dr (1800*7) $12,600          To Cash $12,600 (Being 1800 shares of common stock purchased for the treasury) 1-Oct Cash Dividends Dr ($246000*8%) $19,680       To Dividend Payable $19,680 (Being dividend declared on preferred stock) 1-Nov Dividend Payable $19,680        To Cash $19,680 (Being Dividend paid) 1-Dec Cash Dividends Dr [($1103333/$4 -4100-1800)*0.85] $229,443       To Dividend Payable $229,443 (Being dividend declared on Common stock) 31-Dec Income Summary Dr $275,600          To Retained Earnings $275,600 (To record net income) 31-Dec Retained Earnings Dr $249,123       To Cash Dividends $249,123 (To close Cash Dividends) 31-Dec Dividend Payable $229,443        To Cash $229,443 (Being Dividend paid)

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.