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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Cullumber Corp. had the following shareholders' equity on January 1, 2023:
Common shares, unlimited number authorized, 100,000 shares issued and outstanding
Contributed surplus
Retained earnings
Total shareholders' equity
The following transactions occurred, in the order given, during 2023:
1.
The contributed surplus arose from net excess of proceeds over cost on a previous cancellation of common shares. Cullumber
prepares financial statements in accordance with ASPE.
2.
3.
4.
$290,000
302,000
5.
2,430,000
$3,022,000
Subscriptions were sold for 12,000 common shares at $26 per share. The first payment was for $10 per share.
The second payment for the sale in item 1 above was for $16 per share. All payments were received on the second payment
except for 2,000 shares.
In accordance with the subscription contract, which requires that defaulting subscribers have all their payments refunded,
refund cheques were sent to the defaulting subscribers. At this point, common shares were issued to subscribers who had
fully paid on the contract.
Repurchased 22,000 common shares at $29 per share. They were then retired.
Sold 4,800 preferred shares and 3,700 common shares together for $301,000. The common shares had a fair value of $31 per
share.

Transcribed Image Text:Prepare the journal entries to record the transactions for the company for 2023. (List all debit entries before credit entries. Credit
account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for
the account titles and enter O for the amounts. Round average share price to 2 decimal places, 5.27 and final answers to O decimal places,
e.g. 5,275.)
No. Account Titles and Explanation
1.
2.
3.
Cash
4.
Share Subscriptions Receivable
Common Shares Subscribed
Cash
Share Subscriptions Receivable
Common Shares Subscribed
Share Subscriptions Receivable
Cash
(To record refund to defaulting subscribers)
Show Transcribed Text
(To issue shares fully paid on subscriptions)
Common Shares
Contributed Surplus
Retained Earnings
Cash
5. Cash
Preferred Shares
Common Shares
Debit
120000
192000
Credit
312000
0000000
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