Milton Company’s charter authorizes 1,000,000 shares of common stock and 400,000 shares of preferred stock. In its first year of operations during 2018, the company presented the following transactions:• Issued 5,000 shares of common stock. Stock has par value of $0.01 per share and was issued at $30 per share.• Earned Net income $200,000• Paid dividends of $5 per share. Required.1. Prepare the journal entry to record the following:a. Common stock shares issuedb. Close out net income to retained earningsc. Dividend paidd. Close out dividend to retained earnings. Plz give detailed explanation
Milton Company’s charter authorizes 1,000,000 shares of common stock and 400,000 shares of preferred stock. In its first year of operations during 2018, the company presented the following transactions:• Issued 5,000 shares of common stock. Stock has par value of $0.01 per share and was issued at $30 per share.• Earned Net income $200,000• Paid dividends of $5 per share. Required.1. Prepare the journal entry to record the following:a. Common stock shares issuedb. Close out net income to retained earningsc. Dividend paidd. Close out dividend to retained earnings. Plz give detailed explanation
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Milton Company’s charter authorizes 1,000,000 shares of common stock and 400,000 shares of
• Issued 5,000 shares of common stock. Stock has par value of $0.01 per share and was issued at $30 per share.
• Earned Net income $200,000
• Paid dividends of $5 per share.
Required.
1. Prepare the
a. Common stock shares issued
b. Close out net income to
c. Dividend paid
d. Close out dividend to retained earnings.
Plz give detailed explanation
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