Solution 1:
Alexander Corporation - Journal Entries | |||
Date | Particulars | Debit | Credit |
2-Jan | Treasury Stock A/c Dr | $100,000.00 | |
To Cash | $100,000.00 | ||
(Being 4000 shares of treasury stock purchased at $25 per share) | |||
7-Jan | Retained Earnings Dr | $54,000.00 | |
To Dividend payable [(40000 - 4000)*1.50] | $54,000.00 | ||
(Being dividend declared) | |||
28-Feb | Dividend Payable Dr | $54,000.00 | |
To Cash | $54,000.00 | ||
(Being dividend paid) | |||
9-Jul | Cash A/c Dr (1600*30) | $48,000.00 | |
To Treasury Stock (1600*25) | $40,000.00 | ||
To Additional Paid in Capital (1600*$5) | $8,000.00 | ||
(Being 1600 shares of treasury stock sold at $30 per share) | |||
27-Aug | Cash A/c Dr (2000*20) | $40,000.00 | |
Additional Paid in Capital A/c Dr | $8,000.00 | ||
Retained Earnings Dr (Balancing figure) | $2,000.00 | ||
To Treasury Stock (2000*$25) | $50,000.00 | ||
(Being 2150 shares of treasury stock sold at $20 per share) | |||
9-Sep | Retained Earnings Dr | $79,200.00 | |
To Dividend payable [(40000 - 400)*2] | $79,200.00 | ||
(Being dividend declared) | |||
22-Oct | Dividend Payable Dr | $79,200.00 | |
To Cash | $79,200.00 | ||
(Being dividend paid) | |||
31-Dec | Income summary Dr | $62,000.00 | |
To Retained Earnings | $62,000.00 | ||
(Being income transferred to retained earnings) |
Solution 2:
Alexander Corporation - Statement of Retained Earnings on 31.12.2019 | |
Particulars | Amount |
Opening balance | $375,000.00 |
Add: Income for 2019 | $62,000.00 |
$437,000.00 | |
Less: Dividend Paid ($54,000 + $79,200) | $133,200.00 |
Less: Loss on sale of treasury stock | $2,000.00 |
Ending balance of Retained Earnings | $301,800.00 |
Solution 3:
Stockholder Equity Section of Balance sheet | |
Alexander Corporation at December 31, 2019 | |
Particulars | Amount |
Stockholders Equity: | |
Common
stock—$25 par value, 60,000 shares authorized, 40,000 shares issued and outstanding |
$1,000,000.00 |
Paid-in capital in excess of par value, common stock | $80,000.00 |
Total contributed Capital | $1,080,000.00 |
Retained Earnings | $301,800.00 |
Treasury stock (400*$25) | -$10,000.00 |
Total Stockholder's Equity | $1,371,800.00 |
Alexander Corporation reports the following components of stockholders' equity at December 31, 2018, Common stock-$25 par...
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