Moon Corporation received a charter that authorized the issuance of 119,000 shares of $7 par common stock and 19,000 shares of $75 par, 8 percent cumulative preferred stock. Moon Corporation completed the following transactions during its first two years of operation. Year 1 January 5 Sold 17,850 shares of the $7 par common stock for $9 per share. January 12 Sold 1,900 shares of the 8 percent preferred stock for $85 per share. April 5 Sold 23,800 shares of the $7 par common stock for $11 per share. December 31 During the year, earned $302,000 in cash revenue and paid $240,100 for cash operating expenses. December 31 Declared the cash dividend on the outstanding shares of preferred stock for Year 1. The dividend will be paid on February 15 to stockholders of record on January 10, Year 2. December 31 Closed the revenue, expense, and dividend accounts to the retained earnings account. Year 2 February 15 Paid the cash dividend declared on December 31, Year 1. March 3 Sold 2,850 shares of the $75 par preferred stock for $95 per share. May 5 Purchased 450 shares of the common stock as treasury stock at $14 per share. December 31 During the year, earned $245,100 in cash revenues and paid $178,900 for cash operating expenses. December 31 Declared the annual dividend on the preferred stock and a $0.25 per share dividend on the common stock. December 31 Closed revenue, expense, and dividend accounts to the retained earnings account. a. Prepare journal entries for Moon Corporation's transactions for Year 1 and Year 2 and post them to T-accounts.
Moon Corporation received a charter that authorized the issuance of 119,000 shares of $7 par common stock and 19,000 shares of $75 par, 8 percent cumulative preferred stock. Moon Corporation completed the following transactions during its first two years of operation. Year 1 January 5 Sold 17,850 shares of the $7 par common stock for $9 per share. January 12 Sold 1,900 shares of the 8 percent preferred stock for $85 per share. April 5 Sold 23,800 shares of the $7 par common stock for $11 per share. December 31 During the year, earned $302,000 in cash revenue and paid $240,100 for cash operating expenses. December 31 Declared the cash dividend on the outstanding shares of preferred stock for Year 1. The dividend will be paid on February 15 to stockholders of record on January 10, Year 2. December 31 Closed the revenue, expense, and dividend accounts to the retained earnings account. Year 2 February 15 Paid the cash dividend declared on December 31, Year 1. March 3 Sold 2,850 shares of the $75 par preferred stock for $95 per share. May 5 Purchased 450 shares of the common stock as treasury stock at $14 per share. December 31 During the year, earned $245,100 in cash revenues and paid $178,900 for cash operating expenses. December 31 Declared the annual dividend on the preferred stock and a $0.25 per share dividend on the common stock. December 31 Closed revenue, expense, and dividend accounts to the retained earnings account. a. Prepare journal entries for Moon Corporation's transactions for Year 1 and Year 2 and post them to T-accounts.
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter13: Corporations: Organization, Stock Transactions, And Dividends
Section: Chapter Questions
Problem 3PA: The following selected accounts appear in the ledger of EJ Construction Inc. at the beginning of the...
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Moon Corporation received a charter that authorized the issuance of 119,000 shares of $7 par common stock and 19,000 shares of $75 par, 8 percent cumulative
Year 1
January 5 | Sold 17,850 shares of the $7 par common stock for $9 per share. |
---|---|
January 12 | Sold 1,900 shares of the 8 percent preferred stock for $85 per share. |
April 5 | Sold 23,800 shares of the $7 par common stock for $11 per share. |
December 31 | During the year, earned $302,000 in cash revenue and paid $240,100 for cash operating expenses. |
December 31 | Declared the cash dividend on the outstanding shares of preferred stock for Year 1. The dividend will be paid on February 15 to stockholders of record on January 10, Year 2. |
December 31 | Closed the revenue, expense, and dividend accounts to the |
Year 2
February 15 | Paid the cash dividend declared on December 31, Year 1. |
---|---|
March 3 | Sold 2,850 shares of the $75 par preferred stock for $95 per share. |
May 5 | Purchased 450 shares of the common stock as |
December 31 | During the year, earned $245,100 in cash revenues and paid $178,900 for cash operating expenses. |
December 31 | Declared the annual dividend on the preferred stock and a $0.25 per share dividend on the common stock. |
December 31 | Closed revenue, expense, and dividend accounts to the retained earnings account. |
a. Prepare
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