Question 1

The following selected transactions took place during the current year for a company:  (a)Prepare the journal entries for these transactions.
(b)If Retained Earnings had a $155,000 credit balance on January 1,calculate its year-end balance as of December 31.

Accepted Answer

The answer of The following selected transactions took place during...

Question 2

A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share.The entry to record this transaction would be:

Accepted Answer

When a corporation issues common stock for cash, the entry should debit Cash for the total amount received ($11 x 2,500 = $27,500) and credit Common Stock for the par value ($25,000 in this case) with the excess credited to Paid-in Capital in Excess of Par Value, Common Stock. Since this is a no par stock, we do not need to account for the excess. Therefore, the correct entry is Debit Cash $27,500 and credit Common Stock $25,000 and credit Paid-in Capital in Excess of Par Value, Common Stock $2,500. Choice B is the closest one.

Question 3

Cactus Joe Corporation reported stockholders' equity on January 1 of the current year as follows: Common Stock,$5 par value,1,000,000 shares authorized,600,000 shares issued;Paid-in Capital in Excess of Par Value,Common Stock,$1,025,000;Retained Earnings,$1,850,000.Prepare journal entries to record the following transactions:

Accepted Answer

The answer of Cactus Joe Corporation reported stockholders' equity on...

Question 4

For each of the following independent transactions a through d,prepare the necessary journal entry:
(a)Declared a $0.40 per share cash dividend on 300,000 shares of preferred stock outstanding.
(b)Declared and distributed an 8% stock dividend on 800,000 shares of $5 par value common stock outstanding.Market price per common share on this date was $25.
(c)Declared and distributed a 2-for-1 stock split on 400,000 shares of $10 par value common stock outstanding.
(d)Declared and distributed a 35% stock dividend on 700,000 common shares of $1 par value common stock outstanding.Market price per common share on this date was $20.

Accepted Answer

The answer of For each of the following independent transactions...

Question 5

A company was organized in January 2014 and has 20,000 shares of $10 par value,10%,nonparticipating preferred stock outstanding and 150,000 shares of $2 par value common stock outstanding.It has declared and paid cash dividends each year as shown below.Calculate the total dividends distributed to each class of stockholder under each of the assumptions given.

Accepted Answer

The answer of A company was organized in January 2014...

Question 6

On July 1,a corporation issued 15,000 shares of no-par common stock with a stated value of $3 per share in exchange for a tract of land having a market value of $215,000.Prepare the general journal entry to record this transaction.

Accepted Answer

The answer of On July 1,a corporation issued 15,000 shares...

Question 7

Prior to June 30,a company has never had any treasury stock transactions.A company repurchased 100 shares of its $1 par common stock on June 30 for $40 per share.On July 20,it reissued 50 of these shares at $46 per share.On August 1,it reissued 20 of the shares at $38 per share.What is the journal entry necessary to record the reissuance of treasury stock on July 20?

Accepted Answer

The company reissued 50 shares at $46 each, receiving $2,300 in cash. The treasury stock was originally purchased at $40 per share, totaling $2,000 for 50 shares. The difference of $300 is credited to Paid-in Capital, Treasury Stock.

Question 8

A corporation received its charter and began business this year.The company is authorized to issue 500,000 shares of $100 par,6%,noncumulative,nonparticipating preferred stock,and 1,000,000 shares of no-par common stock.The following selected transactions occurred during this year:  Prepare journal entries to record these transactions.

Accepted Answer

The answer of A corporation received its charter and began...

Question 9

A company is authorized to issue 750,000 shares of $2 par value common stock.Prepare journal entries to record the following selected transactions that occurred during the company's first year of operations:

Accepted Answer

The answer of A company is authorized to issue 750,000...

Question 10

A corporation had the following stock outstanding when the company's board of directors declared a $75,000 cash dividend in the current year:  Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is noncumulative and nonparticipating.

Accepted Answer

The answer of A corporation had the following stock outstanding...

Question 11

Rhoads Corporation is authorized to issue 250,000 shares of $50 par,10%,noncumulative,nonparticipating preferred stock and 5,000,000 shares of no-par common stock.Prepare journal entries to record the following selected transactions that occurred during this year:

Accepted Answer

The answer of Rhoads Corporation is authorized to issue 250,000...

Question 12

The stockholders' equity section of a company's year-end balance sheet follows:  The preferred stock has a call price of $51.50 per share plus dividends in arrears.Only one year of dividends is in arrears.Calculate the book value per (1)preferred share,and (2)common share.

Accepted Answer

The answer of The stockholders' equity section of a company's...

Question 13

Boron Company is authorized to issue 50,000 shares of $50 par value,8%,cumulative,fully participating preferred stock,and 750,000 shares of $5 par value common stock.Prepare journal entries to record the following selected transactions that occurred during the company's first year of operations:

Accepted Answer

The answer of Boron Company is authorized to issue 50,000...

Question 14

A corporation issued 5,000 shares of its no par common stock that was assigned a $1 stated value per share.The issue price was $10 per share.The entry to record this transaction would be:

Accepted Answer

The answer of A corporation issued 5,000 shares of its...

Question 15

A corporation had the following stock outstanding when the company's board of directors declared a $55,000 cash dividend during the current year:  Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is cumulative and nonparticipating and dividends are one year in arrears.

Accepted Answer

The answer of A corporation had the following stock outstanding...

Question 16

Shaw Corporation reported stockholders' equity on December 31 of the prior year as follows:  The following selected transactions occurred during the current year:  Prepare a statement of retained earnings as of December 31 of the current year.

Accepted Answer

The answer of Shaw Corporation reported stockholders' equity on December...

Question 17

Slate Corporation had the following balances in its stockholders' equity accounts at December 31,2015:  The following transactions occurred during 2016:  Based on the above information,prepare a statement of stockholders' equity for 2016.Use the form below.

Accepted Answer

The answer of Slate Corporation had the following balances in...

Question 18

On June 30,a company declared a cash dividend of $0.35 per common share to the shareholders of record on July 15.The cash dividend will be paid on July 31.This company has 500,000 shares authorized and 100,000 shares outstanding.Prepare the journal entries required on June 30,July 15 and July 31.

Accepted Answer

The answer of On June 30,a company declared a cash...

Question 19

On September 20,Fletcher Corporation issued 25,000 shares of no-par common stock for equipment having a market value of $85,000.Prepare the general journal entry to record this transaction.

Accepted Answer

The answer of On September 20,Fletcher Corporation issued 25,000 shares...

Question 20

The stockholders' equity section of a corporation's balance sheet follows:  (1)Assuming that the preferred stock is not callable and no dividends are in arrears,compute the book values per preferred share and per common share.
(2)Assuming that the preferred stock has a call price of $30 per share and one year of cumulative preferred dividends is in arrears,compute the book values per preferred share and per common share.

Accepted Answer

The answer of The stockholders' equity section of a corporation's...

Quiz 13: Accounting for Corporations

The following selected transactions took place during the current year for a company: (a)Prepare the journal entries for these transactions. (b)If Retained Earnings had a $155,000 credit balance on January 1,calculate its year-end balance as of December 31.

A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share.The entry to record this transaction would be:

On July 1,a corporation issued 15,000 shares of no-par common stock with a stated value of $3 per share in exchange for a tract of land having a market value of $215,000.Prepare the general journal entry to record this transaction.

A company is authorized to issue 750,000 shares of $2 par value common stock.Prepare journal entries to record the following selected transactions that occurred during the company's first year of operations:

A corporation had the following stock outstanding when the company's board of directors declared a $75,000 cash dividend in the current year: Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is noncumulative and nonparticipating.

Rhoads Corporation is authorized to issue 250,000 shares of $50 par,10%,noncumulative,nonparticipating preferred stock and 5,000,000 shares of no-par common stock.Prepare journal entries to record the following selected transactions that occurred during this year:

The stockholders' equity section of a company's year-end balance sheet follows: The preferred stock has a call price of $51.50 per share plus dividends in arrears.Only one year of dividends is in arrears.Calculate the book value per (1)preferred share,and (2)common share.

Boron Company is authorized to issue 50,000 shares of $50 par value,8%,cumulative,fully participating preferred stock,and 750,000 shares of $5 par value common stock.Prepare journal entries to record the following selected transactions that occurred during the company's first year of operations:

A corporation issued 5,000 shares of its no par common stock that was assigned a $1 stated value per share.The issue price was $10 per share.The entry to record this transaction would be:

Shaw Corporation reported stockholders' equity on December 31 of the prior year as follows: The following selected transactions occurred during the current year: Prepare a statement of retained earnings as of December 31 of the current year.

Slate Corporation had the following balances in its stockholders' equity accounts at December 31,2015: The following transactions occurred during 2016: Based on the above information,prepare a statement of stockholders' equity for 2016.Use the form below.

On June 30,a company declared a cash dividend of $0.35 per common share to the shareholders of record on July 15.The cash dividend will be paid on July 31.This company has 500,000 shares authorized and 100,000 shares outstanding.Prepare the journal entries required on June 30,July 15 and July 31.

On September 20,Fletcher Corporation issued 25,000 shares of no-par common stock for equipment having a market value of $85,000.Prepare the general journal entry to record this transaction.