Journalize the transactions . For a compound transaction, if an amount box does
ID: 2583686 • Letter: J
Question
Journalize the transactions. For a compound transaction, if an amount box does not require an entry, leave it blank.
Jan. 15. Split the common stock 5 for 1 and reduced the par from $75 to $15 per share. After the split, there were 475,000 common shares outstanding.
Feb. 28. Purchased 38,000 shares of the corporation's own common stock at $20, recording the stock at cost.
May 1. Declared semiannual dividends of $3.10 on 30,000 shares of preferred stock and $0.3 on the common stock to stockholders of record on June 1, payable on July 10.
July 10. Paid the cash dividends.
Sept. 7. Sold 27,000 shares of treasury stock at $28, receiving cash.
Oct. 1. Declared semiannual dividends of $3.10 on the preferred stock and $0.36 on the common stock (before the stock dividend).
Oct. 1. A 2% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $30.
Dec. 1. Paid the cash dividends.
Dec. 1. Issued the certificates for the common stock dividend.
Explanation / Answer
Journal
Date Account Name Debit Credit Jan 15 No entry Feb 28 Treasury stock (38000 x $20) 760000 Cash 760000 May 1 Retained earnings [($3.10 x 30000) + ($0.3 x 475000)] 235500 Dividend payable-Preferred stock 93000 Dividend payable-Common stock 142500 Jul 10 Dividend payable-Preferred stock 93000 Dividend payable-Common stock 142500 Cash 235500 Sept 7 Cash 756000 Additional paid-in capital - Treasury stock 216000 Treasury stock (27000 x $20) 540000 Oct 1 Retained earnings [($3.10 x 30000) + ($0.36 x 475000)] 264000 Dividend payable-Preferred stock 93000 Dividend payable-Common stock 171000 Oct 1 Retained earnings (475000 x 2% x $30) 285000 Additional paid-in capital - Common stock (475000 x 2% x $15) 142500 Common stock dividend distributable (475000 x 2% x $15) 142500 Dec 1 Dividend payable-Preferred stock 93000 Dividend payable-Common stock 171000 Cash 264000 Dec 1 Common stock dividend distributable 142500 Common stock dividend distributable 142500Related Questions
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