Stockholders’ Equity: Transactions and Balance Sheet Presentation The stockholders’ equity of Summit Corporation at January 1 follows: 7 Percent preferred stock, $100 par value, 20,000 shares authorized; 5,000 shares issued and outstanding $500,000 Common stock, $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding 600,000 Paid-in capital in excess of par value-Preferred stock 24,000 Paid-in capital in excess of par value-Common stock 360,000 Retained earnings 325,000 Total Stockholders' Equity $1,809,000 The following transactions, among others, occurred during the year: Jan. 12 Announced a 3-for-1 common stock split, reducing the par value of the common stock to $5 per share. The authorization was increased to 300,000 shares. Mar. 31 Converted $40,000 face value of convertible bonds payable (the book value of the bonds was $43,000) to common stock. Each $1,000 bond converted to 130 shares of common stock. June 1 Acquired equipment with a fair market value of $70,000 in exchange for 500 shares of preferred stock. Sept. 1 Acquired 10,000 shares of common stock for cash at $13 per share. Oct. 12 Sold 1,500 treasury shares at $15 per share. Nov. 21 Issued 5,000 shares of common stock at $14 per share. Dec. 28 Sold 1,200 treasury shares at $11 per share. 31 Closed net income of $91,000 to the Retained Earnings account. Required Prepare journal entries for the given transactions and post them to the T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders’ equity accounts. Prepare the stockholders’ equity section of the balance sheet at December 31.
Date |
Particulars |
Debit |
Credit |
12 -Jan |
Common Stock ($ 15 each) account- Dr To Common Stock ($ 5 each) (Being 3 for 1 spilt for common Stock done) |
$ 6,00,000.00 |
$ 6,00,000.00 |
31 March |
Convertible Bonds Payable account -Dr To Common Stock Account To Retained Earnings Account (Being 5590 shares of Common stock given in Exchange of Convertible Bonds) |
$ 43,000.00 |
$ 27,950.00 $15,050.00 |
1st June |
Equipment account -Dr To Preferred Stock (Being 500 Preferred shares given for acquired a new Equipment) |
$ 50,000.00 |
$ 50,000.00 |
1st Sept |
Common Stock (Investment) Account – Dr To Cash (Being 10000 shares of common Stock purchased) |
$ 13,000.00 |
$13,000.00 |
12th October |
Cash Account - Dr To Treasury Shares account (Bring treasury shares [1500] for $ 15 each)
|
$ 22,500.00 |
$ 22,500.00 |
21st Nov |
Cash Account -Dr To Common Stock account To Paid in excess of par value- common stock account (Being 5000 shares issued @ $ 14 each) |
$ 70,000.00 |
$ 25,000.00 $ 45,000.00 |
28th December |
Cash Account - Dr To Treasury Shares account (Bring treasury shares [1200] for $ 11 each) |
$ 13,200.00 |
$ 13,200.00 |
T Accounts | ||||||||||||||||||||||
Common Stock Account ( $ 15 each) | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To Common stock ( $5 each) | $ 600,000.00 | By bal b/d | $ 600,000.00 | |||||||||||||||||||
$ 600,000.00 | $ 600,000.00 | |||||||||||||||||||||
Common Stock Account ( $ 5 each) | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
By Cash | $ 25,000.00 | |||||||||||||||||||||
To Bal c/d | $ 600,000.00 | By Common stock ( $ 15 each) | $ 600,000.00 | |||||||||||||||||||
$ 600,000.00 | $ 600,000.00 | |||||||||||||||||||||
Convertible bonds Account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To common Stock | $ 27,950.00 | By bal c/d | $ 43,000.00 | |||||||||||||||||||
To retained earnings | $ 15,050.00 | |||||||||||||||||||||
$ 43,000.00 | $ 43,000.00 | |||||||||||||||||||||
Prefered Stock Account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To Bal c/d | $ 550,000.00 | By bal c/d | $ 500,000.00 | |||||||||||||||||||
By Equipment | $ 50,000.00 | |||||||||||||||||||||
$ 550,000.00 | $ 550,000.00 | |||||||||||||||||||||
Equipment account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To Prefered Stock | $ 50,000.00 | By bal c/d | $ 50,000.00 | |||||||||||||||||||
$ 50,000.00 | $ 50,000.00 | |||||||||||||||||||||
Common Stock (Investment ) Account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To Cash | $ 13,000.00 | By bal c/d | $ 13,000.00 | |||||||||||||||||||
$ 13,000.00 | $ 13,000.00 | |||||||||||||||||||||
Treasury Shares account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To bal c/d | By cash | $ 22,500.00 | ||||||||||||||||||||
By cash | $ 13,200.00 | |||||||||||||||||||||
$ - | $ 35,700.00 | |||||||||||||||||||||
Paid in excess of Par value- Common stock account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
By bal c/d | $ 360,000.00 | |||||||||||||||||||||
To bal c/d | $ 405,000.00 | By cash | $ 45,000.00 | |||||||||||||||||||
$ 405,000.00 | $ 405,000.00 | |||||||||||||||||||||
Retained Earning Account | ||||||||||||||||||||||
Particulars | Amount | Particulars | Amount | |||||||||||||||||||
To bal c/d | $ 431,050.00 | By Bal b/d | $ 325,000.00 | |||||||||||||||||||
By convertible bonds | $ 15,050.00 | |||||||||||||||||||||
By Net income | $ 91,000.00 | |||||||||||||||||||||
$ 431,050.00 | $ 431,050.00 | |||||||||||||||||||||
|
Stockholders’ Equity: Transactions and Balance Sheet Presentation The stockholders’ equity of Summit Corporation at January 1...
Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity of Summit Corporation at January 1 follows: 7 Percent preferred stock, $100 par value, 20,000 shares authorized; 5,000 shares issued and outstanding $500,000 Common stock, $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding 600,000 Paid-in capital in excess of par value-Preferred stock 24,000 Paid-in capital in excess of par value-Common stock 360,000 Retained earnings 325,000 Total Stockholders' Equity $1,809,000 The following transactions, among others, occurred during the...
Stockholders’ Equity: Transactions and Balance Sheet Presentation The stockholders’ equity of Summit Corporation at January 1 follows: 7 Percent preferred stock, $100 par value, 20,000 shares authorized; 5,000 shares issued and outstanding $500,000 Common stock, $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding 600,000 Paid-in capital in excess of par value-Preferred stock 24,000 Paid-in capital in excess of par value-Common stock 360,000 Retained earnings 325,000 Total Stockholders' Equity $1,809,000 The following transactions, among others, occurred during the...
Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity of Summit Corporation at January 1 follows: 7 Percent preferred stock, $100 par value, 20,000 shares authorized: 5,000 shares issued and outstanding $500,000 Common stock, $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding 600,000 Paid-in capital in excess of par value-Preferred stock 24,000 Paid-in capital in excess of par value-Common stock 360,000 Retained earnings 325,000 Total Stockholders' Equity $1,809,000 The following transactions, among others, occurred during the...
Stockholders’ Equity: Transactions and Balance Sheet Presentation The stockholders’ equity accounts of Cooper Corporation at January 1 follow: Common stock, $1 par value, 350,000 shares authorized; 150,000 shares issued and outstanding $150,000 Paid-in capital in excess of par value (common stock) 600,000 Retained earnings 366,000 During the year, the following transactions occurred: Jan. 5 Issued 20,000 shares of common stock for $15 cash per share. 18 Purchased 4,000 shares of common stock as treasury stock at $14 cash per share....
Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding $68,000 Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock 200,000 Retained earnings 270,000 During the year, the following transactions occurred: Jan. 10 Issued...
Stockholders’ Equity Transactions, Journal Entries, and T-Accounts The stockholders’ equity of Fremantle Corporation at January 1 follows: 8 Percent preferred stock, $110 par value, 20,000 shares authorized; 4,000 shares issued and outstanding $440,000 Common stock, $4 par value, 10,000 shares authorized; 40,000 shares issued and outstanding 160,000 Paid-in capital in excess of par value-Preferred stock 200,000 Paid-in capital in excess of par value-Common stock 800,000 Retained earnings 550,000 Total Stockholders' Equity $2,150,000 The following transactions, among others, occurred during the...
Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding $68,000 Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock 200,000 Retained earnings 270,000 During the year, the following transactions occurred: Jan. 10 Issued...
BusinessCourse My Subscriptions Alexis Solis Return to course Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding $68,000 Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock 200,000 Retained earnings 270,000 During the...
Need financial accounting help please Stockholders' Equity Transactions, Journal Entries, and T-Accounts The stockholders equity of Fremantle Corporation at January 1 follows: B Percent preferred stock, $110 par value, 20,000 shares $440,000 authorired: 4,0co shares issued and putstanding Con value, 10,04 utstanding 150,000 Paid-in capital in excess af par value Preferred stock 200.000 Paid-in capital in excess of par value-Common stocko Retained earnings 550000 150 0f0 Total Stotkhalders' Equity The following transactions, among others, occurred during the year: 1Announced a...
Stockholders’ Equity: Transactions and Balance Sheet Presentation The stockholders’ equity accounts of Windham Corporation at January 1 appear below: 8 Percent preferred stock, $30 par value, 50,000 shares authorized; 6,800 shares issued and outstanding $204,000 Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock 200,000 Retained earnings 270,000 During the year, the following transactions occurred: Jan. 10 Issued...