Question

Vaughn Manufacturing is authorized to issue 2,960,000 shares of $1 par value common stock. During 2020, the company has the following stock transactions.

Jan. 15		Issued 819,000 shares of stock at $7 per share.
Sept. 5		Purchased 28,000 shares of common stock for the treasury at $9 per share.
Dec. 6		Declared a $0.50 per share dividend to stockholders of record on December 20, payable January 3, 2021.

Journalize the transactions for Vaughn Manufacturing. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
choose a transaction date Jan. 15Sept. 5Dec. 6	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 15Sept. 5Dec. 6	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date Jan. 15Sept. 5Dec. 6	enter an account title	enter a debit amount	enter a credit amount

Answer 1

Solution

Date	Accounts title and explanation	Debit	credit
Jan-15	Cash	$ 5,733,000.00
	Common stock		$     819,000.00
	Paid in capital in excess of par		$ 4,914,000.00
	(To record issue of stock)
Sep-05	Treasury stock	$      252,000.00
	Cash		$     252,000.00
	(To record purchase of treasury stock)
Dec-06	Cash dividend	$      395,500.00
	Dividends payable		$     395,500.00
	(To record declaration of dividend)
Jan-03	Dividends payable	$      395,500.00
	Cash		$     395,500.00
	(To record payment of dividend)