Instructions Record the following transactions (show all calculations). 1. The board of directors approved a $95,000 cash dividend for the preferred and common stockholders. Record the journal entries for the declaration and the payment of the dividend. 2. A 14% common stock dividend was declared. The average fair value of the common stock is $23 a share. Prepare the journal entry for the declaration of the dividend and for the distribution of the stock.
Instructions Record the following transactions (show all calculations). 1. The board of directors approved a $95,000 cash dividend for the preferred and common stockholders. Record the journal entries for the declaration and the payment of the dividend. 2. A 14% common stock dividend was declared. The average fair value of the common stock is $23 a share. Prepare the journal entry for the declaration of the dividend and for the distribution of the stock.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Corporation has the following capital structure at the beginning of the year:
5% Preferred stock, $100 par value, 20,000 shares authorized,
6,000 shares issued and outstanding
Common stock, $10 par value, 60,000 shares authorized,
40,000 shares issued and outstanding
Paid-in capital in excess of par
Total paid-in capital
Retained earnings
Total stockholders' equity
$ 600,000
400,000
110,000
1,110,000
540,000
$1,650,000
I
Instructions
Record the following transactions (show all calculations).
1. The board of directors approved a $95,000 cash dividend for the preferred and common
stockholders. Record the journal entries for the declaration and the payment of the
dividend.
2. A 14% common stock dividend was declared. The average fair value of the common stock
is $23 a share. Prepare the journal entry for the declaration of the dividend and for the
distribution of the stock.
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