Early in the year Bill Sharnes and several friends organized a corporation called Sharnes communications inc. The coorporation was authorized to issue 50,000 shares of $100 par value, 10% cumulative preferred stock, and 400,000 shares of $2 par value common stock. The follwoing transactions occured during the year: Jan 6 Issued for cash 20,000 shares of common stock at $14/share. Shares were issued to Sharnes and 10 other investors. Jan 7 Issued and additional 500 shares of common stock to Sharnes in exchange for his services in organizing the corporation, The stockholders agrees these services were worth $7,000 Jan 12 issued 2500 shares of preferred stock for cash of $250,000 June 4 Acquired land as a building site in exchange for 15,000 shares of common stock. In view of the appraised value of the land and the progress of the company, the directors agreed that the commonstock was to be valued for the purpose of this transaction at $15/share Nov 15 The first annual dividend of $10/share was declared on the preferred stock to be paid Dec 20 Dec 20 Paid the cash dividend declared on Nov 15 Dec 31 After the revenue and expenses were closed into the Income Summary account, that account indicates a net income of $147,000 A. Prepare journal entries in general journal form to record the above transactions. Include entries at Dec 31 to close the income summary account and the diviedends account B. Prepare the stockholders equity section of the Sharnes Communications Inc. balance sheet at Dec 31
Early in the year Bill Sharnes and several friends organized a corporation called Sharnes communications inc. The coorporation was authorized to issue 50,000 shares of $100 par value, 10% cumulative
Jan 6 Issued for cash 20,000 shares of common stock at $14/share. Shares were issued to Sharnes and 10 other investors.
Jan 7 Issued and additional 500 shares of common stock to Sharnes in exchange for his services in organizing the corporation, The stockholders agrees these services were worth $7,000
Jan 12 issued 2500 shares of preferred stock for cash of $250,000
June 4 Acquired land as a building site in exchange for 15,000 shares of common stock. In view of the appraised value of the land and the progress of the company, the directors agreed that the commonstock was to be valued for the purpose of this transaction at $15/share
Nov 15 The first annual dividend of $10/share was declared on the preferred stock to be paid Dec 20
Dec 20 Paid the cash dividend declared on Nov 15
Dec 31 After the revenue and expenses were closed into the Income Summary account, that account indicates a net income of $147,000
A. Prepare
B. Prepare the
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