ACC401B week4 homework

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National University College *

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401B

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Accounting

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Apr 3, 2024

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Whispering Corporation is authorized to issue 45,000 shares of $5 par value common stock. During 2025, Whispering took part in the following selected transactions. a. Issued 4,500 shares of stock at $48 per share, less costs related to the issuance of the stock totaling $6,300. b. Issued 1,100 shares of stock for land appraised at $45,000. The stock was actively traded on a national stock exchange at approximately $49 per share on the date of issuance. c. Purchased 530 shares of treasury stock at $46 per share. The treasury shares purchased were issued in 2021 at $43 per share. d. Retired the treasury shares purchased in part (c). Prepare the journal entries to record these transactions using the cost method. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) ‘ Common Stock ‘ ’ ‘ 22,500 ‘ Paid-in Capital in Excess of Par - Common Stock \ l ‘ ’ 187,200 ‘ b. Land ] [ 53,900 I ‘ Common Stock ‘ ' ‘ ‘ 5,500 ‘ ‘ Paid-in Capital in Excess of Par - Common Stock ‘ ’ ‘ 48,400 C. ‘ Treasury Stock ‘ l 24,380 ‘ ’ ‘ I Cash ] [ I 24,380 d. ‘ Common Stock ‘ l 2,650 ‘ I ‘ Paid-in Capital in Excess of Par - Common Stock ‘ ’ 20,140 ‘ ‘ Retained Earnings ‘ ’ 1,590 ‘ ‘ ‘ ‘ Treasury Stock ‘ l ’ 24,380

The following data were taken from the balance sheet accounts of Novak Corporation on December 31, 2024. Current assets $541,000 Debt investments (trading) 622,000 Common stock (par value $10) 508,000 Paid-in capital in excess of par 143,000 Retained earnings 781,000 Prepare the required journal entries for the following unrelated items. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement.) a. A 5% stock dividend is (1) declared and (2) distributed at a time when the market price per share is $41. b. The par value of the common stock is reduced to $2 with a 5-for-1 stock split. c. Adividend is declared January 5, 2025, and paid January 25, 2025, in bonds held as an investment. The bonds have a book value of $102,000 and a fair value of $132,000. Date Account Titles and Explanation Debit Credit ’ Retained Earnings 104,140 ‘ ’ Common Stock Dividend Distributable ’ Paid-in Capital in Excess of Par - Common Stock ‘ Common Stock Dividend Distributable ’ Common Stock ’ No Entry ’ No Entry an.5,2025 V‘ ’ Debt Investments 30,000 ‘ ’ Gain on Investment | (To record change in value of bonds) an.5,2025 V‘ ‘RetainedEarnings 132,000 ‘

an.5,2025 V‘ ‘ Retained Earnings ‘ l 132,000 ‘ ‘ | ’ Property Dividends Payable ‘ ’ ‘ ’ 132,000| (To record the declaration of dividends) an. 25,2025 V‘ ’ Property Dividends Payable ‘ l 132,000 ‘ ‘ | ’ Debt Investments ‘ ’ ‘ ’ 132,000 | ] D eTextbook and Media Assistance Used Solution Assistance Used a.(1) Retained Earnings = 50,800 shares x 0.05 x $41 = $104,140 b. No entry, memorandum note to indicate that par value is reduced to $2 and the number of shares outstanding is now 254,000 (50,800 5). Blue Company reported the following amounts in the stockholders’ equity section of its December 31, 2024, balance sheet. Preferred stock, 9%, $100 par (10,000 shares authorized, 2,100 shares issued) $210,000 Common stock, $5 par (99,000 shares authorized, 19,800 shares issued) 99,000 Additional paid-in capital 137,000 Retained earnings 410,000 Total $856,000 During 2025, Blue took part in the following transactions concerning stockholders’ equity. 1. Paid the annual 2024 $9 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2024. 2. Purchased 1,900 shares of its own outstanding common stock for $39 per share. Blue uses the cost method. 3. Reissued 700 treasury shares for land valued at $31,500. 4. Issued 530 shares of preferred stock at $105 per share. 5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $47 per share.

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6. Issued the stock dividend. 7. Declared the annual 2025 $9 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2026. (a) Your Answer Correct Answer v Your answer is correct. Prepare journal entries to record the transactions described above. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit 1. ’ Dividends Payable - Preferred Stock V’ ‘ 18,900 ‘ l ‘ ’ Dividends Payable - Common Stock VI l 39,600 ‘ ’ ‘ ’ Cash V‘ ’ ‘ ’ 58,500 ‘ 2. ’ Treasury Stock V‘ ’ 74,100 ‘ ’ ‘ ’ Cash V‘ ’ ‘ ’ 74,100 ‘ 3. ’ Land V‘ ’ 31,500 ‘ ’ ‘ ’ Treasury Stock V‘ ’ ‘ ’ 27,300 ‘ ’ Paid-in Capital from Treasury Stock V‘ ’ ‘ ’ 4,200 ‘ 4. ’ Cash V‘ ’ 55,650 ‘ ’ ‘ ’ Preferred Stock V‘ ’ ‘ ’ 53,000 ‘ ’ Paid-in Capital in Excess of Par - Preferred Stock V‘ ’ ‘ ’ 2,650 ‘ 5. ’ Retained Earnings V‘ ’ 87,420 ‘ ’ ‘ ’ Common Stock Dividend Distributable V‘ [ ‘ ’ 9,300 ‘ ’ Paid-in Capital in Excess of Par - Common Stock vw ’ ‘ ’ 78,120 ‘

l Common Stock Dividend Distributable V’ ' ‘ l 9,300 ‘ [ Paid-in Capital in Excess of Par - Common Stock V’ | ‘ ’ 78,120 ‘ 6. l Common Stock Dividend Distributable V’ ' 9,300 ‘ l ‘ [ Common Stock V’ ‘ ‘ ’ 9,300 ‘ 7. l Retained Earnings q ' 64,590 ‘ [ —‘ ’ Dividends Payable - Common Stock V’ l ‘ ‘ 40,920 ‘ l Dividends Payable - Preferred Stock V’ | ‘ ’ 23,670 ‘ eTextbook and Media Assistance Used Solution Assistance Used 1. Dividends Payable-Preferred (2,100 x $9) = $18,900 Dividends Payable-Common (19,800 x $2) = $39,600 2 Cash (1,900 x $39) = $74,100 8 Treasury Stock (700 x $39) = $27,300 4. Cash (530 x $105) = $55,650 Preferred Stock (530 x $100) = $53,000 5. Retained Earnings (1,860* x $47) = $87,420 Common Stock Dividend Distributable (1,860 x $5) = $9,300 *(19,800 - 1,900 + 700 = 18,600; 18,600 x 0.10) 7% Dividends Payable-Prefrred (2,630 x $9) = $23,670 Dividends Payable-Common (20,460* x $2) = $40,920 *(18,600 + 1,860)

BLUE COMPANY - e Stock V‘ “apital Stock V‘ onal Paid-in Capital V‘ $ ’aid-in Capital V‘ iid-in Capital and Retained Earnings VJ ] : ’ Treasury Stock ‘ H itockholders' Equity V‘ $ Preferred stock, 9%, $100 par, 10,000 shares authorized, 2,630 shares issued and outstanding $263,000 Common stock, $5 par, 99,000 shares authorized, 21,660 shares issued, 20,460 shares outstanding 108,300 Cost of treasury stock (1,200 shares common) 46,800 Preferred stock = $210,000 + $53,000 = $263,000 Common stock = $99,000 + $9,300 = $108,300 Additional paid-in capital = $137,000 + $4,200 + $2,650 + $78,120 = $221,970 Retained earnings = $410,000 - $87,420 - $64,590 + $327,000 = $584,990 Treasury stock = $74,100 - $27,300 = $46,800

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Tamarisk Company’s ledger shows the following balances on December 31, 2025. 6% Preferred stock—$10 par value, outstanding 21,600 shares $216,000 Common stock—$100 par value, outstanding 32,300 shares 3,230,000 Retained earnings 618,000 Assuming that the directors decide to declare total dividends in the amount of $353,000, determine how much each class of stock should receive under each of the conditions stated below. One year's dividends are in arrears on the preferred stock. a. The preferred stock is cumulative and fully participating. (Round the rate of participation to 6 decimal places, e.g.0.014278. Round answers to O decimal places, e.g. 38,487.) Preferred Common $ 34,274 W $ [ 318,726—‘ b. The preferred stock is noncumulative and nonparticipating. (Round answers to O decimal places, e.g. 38,487.) Preferred Common $ ’ 12,9@ $ [ 340,o4ﬂ Preferred Common $ [ 12,960 ‘ $ [ 340,040 i c. The preferred stock is noncumulative and is participating in distributions in excess of a 8% dividend rate on the common stock. (Round the rate of participation to 6 decimal places, e.9.0.014278. Round answers to O decimal places, e.g. 38,487.) Preferred Common $ 18,077 ‘ $ [ 334,923

Before Waterway Corporation engages in the following treasury stock transactions, its general ledger reflects, among others, the following account balances (par value of its stock is $30 per share). Paid-in Capital in Excess of Par—Common Stock Common Stock Retained Earnings $93,900 $292,500 $85,600 Record the treasury stock transactions (given below) under the cost method of handling treasury stock; use the FIFO method for purchase-sale purposes. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) a. Bought 380 shares of treasury stock at $39 per share. b. Bought 310 shares of treasury stock at $44 per share. c. Sold 370 shares of treasury stock at $41 per share. d. Sold 100 shares of treasury stock at $37 per share. No. Account Titles and Explanation Debit Credit a. l Treasury Stock l ‘ 14,820 ‘ l ‘ ’ Cash ’ ‘ ‘ ’ 14,820 ‘ b. ‘ Treasury Stock J ’ 13,640 ‘ \ J [ cash | | | | 1364 | C. Cash ‘ ’ 15,170 ‘ [ ‘ ] Treasury Stock ‘ ’ ‘ ’ 14,430 ‘ ' Paid-in Capital from Treasury Stock ‘ ’ ‘ [ 740 ‘ d. ‘ Cash ‘ ’ 3,700 ‘ ’ ‘ Paid-in Capital from Treasury Stock ‘ ’ 650 ‘ [ ‘ l Treasury Stock ‘ ‘ ‘ ’ 4,350 ‘

ACC401B week4 homework

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