Peterson Company issued 4,000 shares of preferred Mock for $240,000. The stock h

Question

Peterson Company issued 4,000 shares of preferred Mock for $240,000. The stock has a par journal entry to record this transaction would: credit Cash $240,000. debit Common stock $4.000. and debit Paid-in capital $236.000. debit Cash $240,000. credit Common stock $4,000. and credit Paid-in capital $236,000. credit Cash $240,000 and debit Preferred stock $240,000. debit Cash $240,000 and credit Preferred stock $240,000. Occidental Produce Company has 40.000 shares of common Mock outstanding and 2.000 share of common stock outstanding and 2,000 shares of preferred stock outstanding. The common stock is $0.01 par value; the preferred stock is 4% non-cumulative, with $100 par value, on October 15, 2014, the company declares a total dividend payment of $40,000. What is the total amount be paid to the common shareholders $40,000 $32,000 $400 $4,500

Explanation / Answer

         3 Peterson company No of Preferred shares issued                 4,000 Par Value                       60 Total Par value of the issue            240,000 So the entry will be Dr $240,000 cash And Cr $240,000 Preferred Stock at Par. So Option D is correct.          4 Occidental Prudence Company No of Preferred Stock outstanding                 2,000 Preferred stock value @$100            200,000 Preference Dividend @4%=                 8,000 Total Dividend declared by company               40,000 Less Preference Dividend                 8,000 Dividend for Equity share holders               32,000 So Option B is correct.

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