Question #3 - Accounting for various stockholders' equity transactions The balance sheet of Johnson Supply, Inc. on Dec 31, 2021, reported 800,000 shares of $2 par common stock authorized with 116,000 shares issued and outstanding. Paid-in Capital in Excess of Par-Common had a balance of $300,000. Retained Earnings had a balance of $107,000. During 2022, the company completed the following selected transactions: Feb 15- Purchased 4,000 shares of treasury stock at $7 per share Mar 8-Sold 1,000 shares of treasury stock for $12 per share Sep 28-Declared and distributed a 15% stock dividend on the 113,000 shares of outstanding share. common stock. The market value of Johnson Supply's common stock was $6 per Requirements 1. Record the transactions in the journal. Don't' forget your explanations or descriptions. 2. Prepare the Stockholders' equity section of the balance sheet on December 31, 2022, assuming the company earned $131,000 of net income during the year. Provide all details of the shares for each type of stock such as Authorized, Issued and Outstanding as well as the dollar amounts in the ending account balance. Remember the beginning balances will be affected by the above journal entry transactions.
Question #3 - Accounting for various stockholders' equity transactions The balance sheet of Johnson Supply, Inc. on Dec 31, 2021, reported 800,000 shares of $2 par common stock authorized with 116,000 shares issued and outstanding. Paid-in Capital in Excess of Par-Common had a balance of $300,000. Retained Earnings had a balance of $107,000. During 2022, the company completed the following selected transactions: Feb 15- Purchased 4,000 shares of treasury stock at $7 per share Mar 8-Sold 1,000 shares of treasury stock for $12 per share Sep 28-Declared and distributed a 15% stock dividend on the 113,000 shares of outstanding share. common stock. The market value of Johnson Supply's common stock was $6 per Requirements 1. Record the transactions in the journal. Don't' forget your explanations or descriptions. 2. Prepare the Stockholders' equity section of the balance sheet on December 31, 2022, assuming the company earned $131,000 of net income during the year. Provide all details of the shares for each type of stock such as Authorized, Issued and Outstanding as well as the dollar amounts in the ending account balance. Remember the beginning balances will be affected by the above journal entry transactions.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Question #3 - Accounting for various stockholders' equity transactions
The balance sheet of Johnson Supply, Inc. on Dec 31, 2021, reported 800,000 shares of $2
par common stock authorized with 116,000 shares issued and outstanding. Paid-in Capital in
Excess of Par-Common had a balance of $300,000. Retained Earnings had a balance of
$107,000. During 2022, the company completed the following selected transactions:
Feb 15- Purchased 4,000 shares of treasury stock at $7 per share
Mar 8-Sold 1,000 shares of treasury stock for $12 per share
Sep 28-Declared and distributed a 15% stock dividend on the 113,000 shares of
outstanding common stock. The market value of Johnson Supply's common stock was $6 per
share.
Requirements
1. Record the transactions in the journal. Don't' forget your explanations or descriptions.
2. Prepare the Stockholders' equity section of the balance sheet on December 31, 2022,
assuming the company earned $131,000 of net income during the year. Provide all
details of the shares for each type of stock such as Authorized, Issued and Outstanding
as well as the dollar amounts in the ending account balance. Remember the beginning
balances will be affected by the above journal entry transactions.
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