### Conversion of Preferred Stock to Common StockCulver Corporation issued 1,800 shares of $10 par value common stock upon conversion of 900 shares of $50 par value preferred stock. The preferred stock was originally issued at $54 per share. The common stock is trading at $23 per share at the time of conversion.Record the conversion of the preferred stock. (*Credit account titles are automatically indented when an amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.*)| Account Titles and Explanation | Debit | Credit ||--------------------------------------------------|--------|--------|| Common Stock | $18,000 | || Paid-in Capital in Excess of Par - Common Stock | $23,400 | || Preferred Stock | | $45,000|| Paid-in Capital in Excess of Par - Preferred Stock| | $3,600 |In the journal entry:- **Common Stock** is debited $18,000, which is calculated as 1,800 shares times the $10 par value per share.- **Paid-in Capital in Excess of Par - Common Stock** is debited $23,400, representing the difference between the total market value of the issued common stock and its par value (1,800 shares x ($23 market value - $10 par value) = $23,400).- **Preferred Stock** is credited $45,000, calculated as 900 shares times the $50 par value per share.- **Paid-in Capital in Excess of Par - Preferred Stock** is credited $3,600, calculated as 900 shares times the difference between the original issue price and the par value ($54 - $50).This journal entry reflects the conversion of preferred stock into common stock according to the given terms and financial data.

Date Particulars Debit Credit - Preferred Stock (900 X 50) 45,000 Paid - in capital in…

Culver Corporation issued 1,800 shares of $10 par value common stock upon conversion of 900 shares of $50 par value prefer stock. The preferred stock was originally issued at $54 per share. The common stock is trading at $23 per share at the time of conversion. Record the conversion of the preferred stock. (Credit account titles are automatically indented when amount is entered. Do not inde manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

Culver Corporation issued 1,800 shares of $10 par value common stock upon conversion of 900 shares of $50 par value prefer stock. The preferred stock was originally issued at $54 per share. The common stock is trading at $23 per share at the time of conversion. Record the conversion of the preferred stock. (Credit account titles are automatically indented when amount is entered. Do not inde manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

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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