Required : all the Journal Entries for the entries with steps explanation computation formula
At the beginning of 2024, Taylor Corporation had the following
Common Stock, $10 Par Value $2,500,000 Paid-In Capital in Excess of Par: Common 500,000
Paid-In Capital,
Paid-In Capital, Stock Options 44,000
Treasury Stock (15,000 shares) (180,000)
Total Stockholders’ Equity $5,868,000
The paid-in capital from stock options relates to options granted on 1/1/20 to the CEO as incentive compensation. As of 1/1/24, the remaining expected benefit period is six years; expense has been and will be recorded evenly over the benefit period.
The following events were among the many occurring in 2024:
a. January 2: Purchased 4,000 shares of its common stock for $18 per share. Brown uses the cost method of accounting for treasury stock transactions.
b. February 1: Declared and paid a cash dividend of $3 per share on the outstanding common stock. (Hint: Don’t forget to consider Treasury Stock existing on 1/1/24 when computing outstanding shares.
) c. April 1: Issued 18,000 shares of $40 par, noncumulative, convertible 6%
d. July 1: 2,000 shares of treasury stock that had been purchased in a prior year for $11 per share were re-issued for $8 per share.
e. August 1: Holders of 4,000 shares of the preferred stock converted their shares into common stock when the market value of the common stock was $21 per share. Brown uses the book value method of accounting for conversions.
f. October 1: Declared and distributed a 1% stock dividend on common stock outstanding when the market price of the stock was $16 per share.
g. November 1: Corrected an error that was made several years ago, when land that had been purchased for $40,000 was inadvertently expensed.
h. December 1: Declared and distributed a property dividend of land to preferred shareholders. The land had a fair value of $45,000 and a carrying value of $44,000.
i. December 31: Recorded 2024 compensation expense related to the stock options.
Required : all the
with steps explanation computation formula
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