b) On January 1, 2014, Dolan Corporation had 60,000 ordinary shares with a RM1 par valueissued and outstanding. During the year, the following transactions occurred:Mar 1 Issued 20,000 ordinary shares for RM400,000.June 1 Declared a cash dividend of RM2 per share to shareholders of record on June 15.June 30 Paid the RM2 cash dividend.Dec 1 Purchased 4,000 ordinary shares for the treasury for RM22 per share.Dec 15 Declared a cash dividend on outstanding shares of RM2.25 per share toshareholders of record on December 31.RequiredPrepare journal entries to record the above transactions. a) The board of directors of Gibson Corporation is considering two plans for financing thepurchase of new plant equipment. Plan #1 would require the issuance of RM4,000,000,6%, 20-year bonds at face value. Plan #2 would require the issuance of 100,000 ordinaryshares with a RM5 par value which are selling for RM40 per share on the open market.Gibson Corporation currently has 100,000 ordinary shares outstanding and the income taxrate is expected to be 30%. Assume that income before interest and income taxes isexpected to be RM800,000 if the new factory equipment is purchased.RequiredPrepare a schedule which shows the expected net income after taxes and the earnings pershare under each of the plans that the board of directors is considering.

Journal entry is the practice of recording commercial transactions for the first time in the books…

b) On January 1, 2014, Dolan Corporation had 60,000 ordinary share issued and outstanding. During the year, the following transaction Mar 1 Issued 20,000 ordinary shares for RM400,000. June 1 Declared a cash dividend of RM2 per share to sharehol June 30 Paid the RM2 cash dividend. Dec 1 Purchased 4,000 ordinary shares for the treasury for R Dec 15 Declared a cash dividend on outstanding shares

b) On January 1, 2014, Dolan Corporation had 60,000 ordinary share issued and outstanding. During the year, the following transaction Mar 1 Issued 20,000 ordinary shares for RM400,000. June 1 Declared a cash dividend of RM2 per share to sharehol June 30 Paid the RM2 cash dividend. Dec 1 Purchased 4,000 ordinary shares for the treasury for R Dec 15 Declared a cash dividend on outstanding shares

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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