Recently the following transactions have taken place. a. NGS issues 1,500 prefer
ID: 2478346 • Letter: R
Question
Recently the following transactions have taken place.
a. NGS issues 1,500 preferred shares for $11 a share.
b. NGS repurchases 1,500 common shares for $10 a share.
c. On November 12, the board of directors declares a $0.10 cash dividend on each outstanding preferred share.
d. The dividend is paid December 20.
Record the issuance of 1,500 shares of preferred stock with no par value for a price of $11 per share.
Record the purchase of 1,500 previously issued common shares for a price of $10 per share.
Record the declaration of a $0.10 cash dividend on the shares of preferred stock outstanding.
Record the payment of the cash dividend to the preferred shareholders.
Incidentally each of the journal entries look like this
Required: 1. Prepare the journal entries needed for each of the transactions. (If no entry is required for a transactionlevent, select "No Journal Entry Required in the first account field.) view transaction listview general journal Journal Entry Worksheet 1330 2 3 4 with no par Record the issuance of 1,500 shares of preferred stock for a price of $11 per share. Transaction General Journal Debit Credit *Enter debits before credits done clear entry record entryExplanation / Answer
Solution:
Transaction
General Journal
Debit
Credit
a
Cash A/c Dr.
(1,500*11)
$16,500
To Preferred Stock
$16,500
(Being Preferred Stock with no par value issued for a price of $11 per share)
b
Treasury Stock Dr.
$15,000
To Cash A/c
$15,000
(Being common shares re-purchased for a price $10)
c
Dividend on Preferred Stock Declared Dr.
(1,500*$0.10)
$150
To Dividend Payable – Preferred Stock
$150
(Being dividend declared @ $0.10 each for preferred stock outstanding)
D
Dividend Payable – Preferred Stock Dr.
$150
To Cash
$150
(Being cash dividend on preferred stock paid)
Transaction
General Journal
Debit
Credit
a
Cash A/c Dr.
(1,500*11)
$16,500
To Preferred Stock
$16,500
(Being Preferred Stock with no par value issued for a price of $11 per share)
b
Treasury Stock Dr.
$15,000
To Cash A/c
$15,000
(Being common shares re-purchased for a price $10)
c
Dividend on Preferred Stock Declared Dr.
(1,500*$0.10)
$150
To Dividend Payable – Preferred Stock
$150
(Being dividend declared @ $0.10 each for preferred stock outstanding)
D
Dividend Payable – Preferred Stock Dr.
$150
To Cash
$150
(Being cash dividend on preferred stock paid)
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.