Jan. 18 Issued 4,000 shares of preferred stock for cash of $400,000. July 5 Acquired land as a building site in exchange for 10,000 shares of common stock. In view of the appraised value of the land and the progress of the company, the directors agreed that the common stock was to be valued for purposes of this transaction at $12 per share. Nov. 25 The first annual dividend of $5 per share was declared on the preferred stock to be paid December 11. Dec. 11 Paid the cash dividend declared on November 25. Dec. 31 After the revenue and expenses were closed into the Income Summary account, that amount indicated a net income of $810,000. Set B 515 Instructions a. Prepare journal entries in general journal form to record the above transactions. Include entries at December 31 to close the Income Summary account and the Dividends account. b. Prepare the stockholders' equity section of the Markup, Inc., balance sheet at December 31.
Jan. 18 Issued 4,000 shares of preferred stock for cash of $400,000. July 5 Acquired land as a building site in exchange for 10,000 shares of common stock. In view of the appraised value of the land and the progress of the company, the directors agreed that the common stock was to be valued for purposes of this transaction at $12 per share. Nov. 25 The first annual dividend of $5 per share was declared on the preferred stock to be paid December 11. Dec. 11 Paid the cash dividend declared on November 25. Dec. 31 After the revenue and expenses were closed into the Income Summary account, that amount indicated a net income of $810,000. Set B 515 Instructions a. Prepare journal entries in general journal form to record the above transactions. Include entries at December 31 to close the Income Summary account and the Dividends account. b. Prepare the stockholders' equity section of the Markup, Inc., balance sheet at December 31.
Chapter1: Financial Statements And Business Decisions
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