Coronado Company reported the following amounts in the stockholders’ equity section of its December 31, 2019, balance sheet. Preferred stock, 9%, $100 par (10,000 shares authorized, 1,900 shares issued) $190,000 Common stock, $5 par (108,500 shares authorized, 21,700 shares issued) 108,500 Additional paid-in capital 116,000 Retained earnings 424,000 Total $838,500 During 2020, Coronado took part in the following transactions concerning stockholders’ equity. 1. Paid the annual 2019 $9 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019. 2. Purchased 1,600 shares of its own outstanding common stock for $39 per share. Coronado uses the cost method. 3. Reissued 800 treasury shares for land valued at $31,600. 4. Issued 460 shares of preferred stock at $103 per share. 5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $42 per share. 6. Issued the stock dividend. 7. Declared the annual 2020 $9 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2021. A) Prepare journal entries to record the transactions described above B)Prepare the December 31, 2020, stockholders’ equity section. Assume 2020 net income was $316,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Concept explainers

Question

Coronado Company reported the following amounts in the stockholders’ equity section of its December 31, 2019, balance sheet.

Preferred stock, 9%, $100 par (10,000 shares authorized, 1,900 shares issued)		$190,000
Common stock, $5 par (108,500 shares authorized, 21,700 shares issued)		108,500
Additional paid-in capital		116,000
Retained earnings		424,000
Total		$838,500

During 2020, Coronado took part in the following transactions concerning stockholders’ equity.

1.		Paid the annual 2019 $9 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019.
2.		Purchased 1,600 shares of its own outstanding common stock for $39 per share. Coronado uses the cost method.
3.		Reissued 800 treasury shares for land valued at $31,600.
4.		Issued 460 shares of preferred stock at $103 per share.
5.		Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $42 per share.
6.		Issued the stock dividend.
7.		Declared the annual 2020 $9 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2021.

A) Prepare journal entries to record the transactions described above

B)Prepare the December 31, 2020, stockholders’ equity section. Assume 2020 net income was $316,000.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions