Question

Halbor Manufacturing Co. completed the following transactions during 2018: i (Click the icon to view the transactions.) Read the requirements Requirement 1. Record the transactions in Halbom's general journal (Record debits first, then credits. Select the explanation on the last line of the journal entry table. If no entry is required, select "No entry required" on the first line of the Accounts and Explanation column and leave the remaining cells blank.) Date Jan. 16: Declared a cash dividend on the 5%, $95 par noncumulative preferred stock (1,000 shares outstanding). Declared a $0.40 per share dividend on the 105,000 shares of $8 par value common stock outstanding. The date of record is January 31, and the payment date is February 15. Accounts and Explanation Debit Credit Jan. 16 Cash Dividends 46,750 Dividends PayablePreferred 4.750 Dividends Payable Common 42,000 Declared a cash dividend.

Answer 1

Halborn's General Journal
Date	Accounts and Explanation		Debit	Credit
16-Jan	Dividend A/c	Dr	46750
	To Dividend Payable A/c - Preferred Stock			4750
	To Dividend Payable A/c - Common Stock			42000
	(Being Dividend declared)
15-Feb	Dividend Payable A/c - Preferred Stock	Dr	4750
	Dividend Payable A/c - Common Stock	Dr	42000
	To Bank A/c			46750
	(Being Dividend Paid)
10-Jun	No Journal entry needed		Note 1
30-Jul	Retained Earning A/c (210000*50%*4)	Dr	420000
	To Stock Dividend Payable A/c - Common Stock			420000
	(Being Stock Dividend declared @ $4 par value)
15-Aug	Stock Dividend Payable A/c - Common Stock		420000
	To Common Stock A/c			420000
	(Being Stock Dividend distributed)
26-Oct	Treasury Stock A/c ( 8000*9)	Dr	72000
	To Bank A/c			72000
	(Being Common Stock Bought Back)
8-Nov	Bank A/c	Dr	40000
	To Treasury Stock A/c			36000
	To Paid in treasury capital Stock A/c/Retained earning			4000
	(Being 4000 Treasury Stock Sold out of 8000)
30-Nov	Bank A/c	Dr	7000
	Paid in Treasury Stock A/c (1400*4 i.e 9-5)/retained earnings	Dr	5600
	To Treasury Stock A/c			12600
	(Being 1400 Treasury Stock Sold out of balance 4000)

Note 1

Stock splits are events that increase the number of shares outstanding and decrease the par value of stock

Common Stock outstanding = 105000

par value of stock = $8

market capitalization is 105000*8 = $840000 (This will not change due to split up)

After Split up of 2 for 1

Outstanding 105000*2=210000 shares

Par value of Stock = $840000/210000 shares= $4 per share

Since no change in value no journal entries required

Halborn's Stockholders Equity
Particulars		$
Authorized Stock
Preferred stock	2400 shares
Common Stock	500000 shares
Issued Capital
Preferred Stock (1000*95)		$        95,000.00
Common Stock (210000*4)	840000
Add: Common stock (50%) dividend distributed	420000
Less: Treasury Stock (8000-4000-1400)	23400
		$ 1,236,600.00
Reatained Earnings		$ 1,080,000.00
		$ 2,411,600.00