On January 1, 2022, Metro Inc. had the following account balances in its shareholders' equity accounts. Common stock, $1 par, 250,000 shares issued250,000Additional paid-in capital, common500,000Additional paid-in capital, preferred100,000Preferred stock, $100 par, 10,000 shares issued1,000,000Retained earnings2,000,000Treasury stock, at cost, 5,000 common shares25,000 During 2022, Metro Inc. had several transactions relating to common stock. January 15:Declared a property dividend of 100,000 shares of Denver Company (book value $10 per share, fair value $9 per share).February 17:Distributed the property dividend.July 18:Declared and distributed a 3% stock dividend on outstanding common stock. The fair value is $5 per share.December 1:Declared a 50 cents per share cash dividend on the outstanding common shares.December 20:Paid the cash dividend. 1) Prepare the journal entry (ies) for the above transactions.1/15/222/17/227/18/2212/1/2212/20/22 2) Prepare the shareholders' equity section of Metro's balance sheet as of December 31, 2022. Assume net income is $500,000 for 2022.

Answered: Image /qna-images/answer/f01a8522-0fac-4ecd-b308-33b9f877179e.jpg1. Prepare journal entries as follows: - 2. Prepare the shareholders' equity section as follows: -

Answered: On January 1, 2022, Metro Inc. had the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 1, 2022, Metro Inc. had the following account balances in its shareholders' equity accounts.

Common stock, $1 par, 250,000 shares issued	250,000
Additional paid-in capital, common	500,000
Additional paid-in capital, preferred	100,000
Preferred stock, $100 par, 10,000 shares issued	1,000,000
Retained earnings	2,000,000
Treasury stock, at cost, 5,000 common shares	25,000

During 2022, Metro Inc. had several transactions relating to common stock.

January 15:	Declared a property dividend of 100,000 shares of Denver Company (book value $10 per share, fair value $9 per share).
February 17:	Distributed the property dividend.
July 18:	Declared and distributed a 3% stock dividend on outstanding common stock. The fair value is $5 per share.
December 1:	Declared a 50 cents per share cash dividend on the outstanding common shares.
December 20:	Paid the cash dividend.

1) Prepare the journal entry (ies) for the above transactions.

1/15/22

2/17/22

7/18/22

12/1/22

12/20/22

2) Prepare the shareholders' equity section of Metro's balance sheet as of December 31, 2022. Assume net income is $500,000 for 2022.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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