Question

books/9781260481976/cf/6/64/4/2/32/150/2000 Part B During 2021, the Nicklas Corporation participated in three treasury stock transactions: a. On June 30, 2021, the corporation reacquires 200,000 shares for the treasury at a price of $12 per share b. On July 31, 2021, 50,000 treasury shares are reissued at $15 per share c. On September 30, 2021, 50,000 treasury shares are reissued at $10 per share. Required: 1. Prepare joumal entries to record these transactions 2. Prepare the Nicklaus Corporation shareholders' equity section as it would appear in a balance sheet prepared at September 30, 2021 (Assume net income for the second and third quarter was $3,000,000.) Part C On October 1, 2021, Nicklaus Corporation receives permission to replace its Si par value common stock (5,000,000 shares authorized, 3,000,000 shares issued, and 2,900,000 shares outstanding) with a new common stock issue having a $0.50 par value. Since the new par value is one-half the amount of the old, this represents a 2-for-1 stock split. That is, the shareholders will receive two shares of the SO 50 par stock in exchange for each share of the $1 par stock they own. The $1 par stock will be collected and destroyed by the issuing corporation On November 1, 2021, the Nicklaus Corporation declares a 50.05 per share cash dividend on common stock and a $0.25 per share cash dividend on preferred stock. Payment is scheduled for December 1, 2021, to shareholders of record on November 15, 2021 page 1096 On December 2, 2021, the Nicklaus Corporation declares a 1% stock dividend payable on December 28, 2021, to shareholders of record on December 14. At the date of declaration, the common stock was selling in the open market at $10 per share. The dividend will result in 58,000 (0.01 x 5,800,000) additional shares being issued to shareholders. Required: 1. Prepare journal entries to record the declaration and payment of these stock and cash dividends 2. Prepare the December 31, 2021, shareholders' equity section of the balance sheet for the Nicklaus Corporation (Assume net income for the fourth quarter was $2,500,000.) 3. Prepare a statement of shareholders' equity for Nicklaus Corporation for 2021. > 3:29 PM * 2/10/2020

having trouble with part B2 and all of C

Answer 1

Part B

1.

Date	Account Titles	Debit	Credit
Jun-30	Treasury Stock	$   2,400,000
	Cash		$   2,400,000
Jul-31	Cash	$       750,000
	Treasury Stock		$       600,000
	Paid in capital from Treasury Stock		$       150,000
Sep-30	Cash	$       500,000
	Paid in capital from Treasury Stock	$       100,000
	Treasury Stock		$       600,000

2.

Stockholder's equity
Common Stock, $1 par value, 3,000,000 issued	$   3,000,000
Preferred Stock, $5 par value, 1,000,000 issued	$   5,000,000
Paid in capital in excess of par-Common Stock	$ 27,000,000
Paid in capital in excess of par-Preferred Stock	$ 15,000,000
Total Paid in capital	$ 50,000,000
Retained Earnings	$   3,000,000
	$ 53,000,000
Less Treasury Stock	$ -1,200,000
Total Stockholder's equity	$ 51,800,000

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