Question

Surfing Dewd Corporation is authorized to issue both preferred and common stock. Surfing Dewd's preferred stock is $105 par, 6% preferred stock. During the first month of operations, the company engaged in the following transactions related to its stock. Show each of the following transactions in the accounting equation: March 1 Issued 16,000 shares of $0.50 par value common stock for cash at $5.00 per share Issued 1,500 shares of preferred stock at par March 11 Purchased 3,000 shares of common stock to be held in the treasury for $7 per share March 16 March 18 Issued 32,000 shares $0.50 par value common stock for cash at $10 per share March 20 Sold 2,900 shares of the treasury stock purchased on the 16th for $12 per share March 31 Declared a $10,000 dividend Show how each transaction would affect the accounting equation. Some of the account names will be abbreviated. March 1: Issued 16,000 shares of $0.50 par value common stock for cash at $5.00 per share (Use parentheses or a minus sign when entering component decreases or contra account increases. Use only the necessary input lines.) Shareholders' Equity Assets Liabilities Contributed Capital Retained Earnings $ $ $ $ Account Account Account Аccount March 11: Issued 1,500 shares of preferred stock at par (Use parentheses or a minus sign when entering component decreases or contra account increases. Use only the necessary input lines.) Shareholders' Equity Contributed Capital Retained Earnings Liabilities Assets + $ $ $ $ Account Account Аccount Account March 16: Purchased 3,000 shares of common stock to be held in the treasury for $7 per share (Use parentheses or a minus sign when entering component decreases or contra account increases. Use only the necessary input lines.) Shareholders' Equity Contributed Capital Retained Earnings Assets Liabilities $ $ $ Account Account Аccount Account

Answer 1

A C D E F G Н К L 1 Mar. 1 Stockholders' equity 3 Contributed capital Retained earnings Liabilities 4 Assets + + $ $ Account Account 5 Account Account 80,000 Cash 8,000 Common stock 6 72,000 Paid in capital in excess of par-Common stock 7 8 9 Mar. 11 Stockholders' equity 10 Contributed capital Retained earnings Liabilities 11 Assets + $ Account 12 Account Account Account 157,500 Cash 157,500 Preferred stock 13 14 15 Mar. 16 Stockholders' equity 16 Contributed capital Retained earnings Liabilities 17 Assets 18 Account Account Account Account (21,000) Cash (21,000) Treasury stock 19 20 21 Mar. 18 Stockholders' equity 22 Contributed capital Liabilities Retained earnings 23 Assets + + $ $ Account Account 24 Account Account 320,000 Cash 16,000 Common stock 25 304,000 Paid in capital in excess of par-Common stock 26 27 28 Mar. 20 Stockholders' equity 29 Retained earnings Contributed capital Liabilities 30 Assets + $ Account 31 Account Account Account 20,300 Treasury stock 14,500 Paid in capital from treasury stock 34,800 Cash 32 33 34 35 Mar. 31 Stockholders' equity 36 Contributed capital Retained earnings Liabilities 37 Assets Account $ 38 Account Account Account 10,000 Dividend payable -10,000 Cash dividend 39

Working note:

А C DE F G н J K L 2 Mar. 1 Stockholders' equity 3 Contributed capital Retained earnings Liabilities 4. Assets + Account $ $ 5 Account Account Account - 16000*5 =16000*0.5 Common stock -86-H6 Cash 6 Paid in capital in excess of par-Common stock 7 8 Mar. 11 9 Stockholders' equity 10 Retained earnings Contributed capital Liabilities 11 Assets $ -1500*105 Cash Account 12 Account Account Account - 1500*105Preferred stock 13 14 Mar. 16 15 Stockholders' equity 16 Contributed capital Retained earnings Liabilities 17 Assets $ $ Account 18 Account Account Account Cash Treasury stock -3000*7 -3000*7 19 20 21 Mar. 18 Stockholders' equity 22 Retained earnings Contributed capital Liabilities 23 Assets + Account $ $ $ $ 24 Account Account Account -32000*10 Cash 32000*0.5 Common stock - B25-H25 25 Paid in capital in excess of par-Common stock 26 27 Mar. 20 28 Stockholders' equity 29 Contributed capital Retained earnings Liabilities 30 Assets $ -2900*12 $ $ - 2900*7 $ Account 31 Account Account Account Treasury stock Paid in capital from treasury stock Cash 32 -B32-H32 33 34 Mar. 31 35 Stockholders' equity 36 Contributed capital Liabilities Retained earnings Assets 37 + $ $ Account 38 Account Account Account 10000 Dividend payable -10000 Cash dividend 39 AO