Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding $68,000 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock Retained earnings 200,000 270,000 During the year, the following transactions occurred: Jan. 10 Issued 35,000 shares of common stock for $18 cash per share, 23 Purchased 10,000 shares of common stock as treasury stock at $19 per share. Mar. 14 Sold one-half of the treasury shares acquired January 23 for $21 per share. July 15 Issued 3,500 shares of preferred stock in exchange for equipment with a fair market value of $128,000. Nov. 15 Sold 1,000 of the treasury shares acquired January 23 for $24 per share. Dec. 31 Closed the net income of $59,000 to the Retained Earnings account. Required Prepare journal entries to record the foregoing transactions and post to T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders' equity accounts. Prepare the December 31 stockholders' equity section of the balance sheet.
Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity accounts of Willis Corporation at January 1 appear below: 8 Percent preferred stock, $10 par value, 50,000 shares authorized; 6,800 shares issued and outstanding Common stock, $10 par value, 200,000 shares authorized; 50,000 shares issued and outstanding $68,000 500,000 Paid-in capital in excess of par value-Preferred stock 68,000 Paid-in capital in excess of par value-Common stock Retained earnings 200,000 270,000 During the year, the following transactions occurred: Jan. 10 Issued 35,000 shares of common stock for $18 cash per share, 23 Purchased 10,000 shares of common stock as treasury stock at $19 per share. Mar. 14 Sold one-half of the treasury shares acquired January 23 for $21 per share. July 15 Issued 3,500 shares of preferred stock in exchange for equipment with a fair market value of $128,000. Nov. 15 Sold 1,000 of the treasury shares acquired January 23 for $24 per share. Dec. 31 Closed the net income of $59,000 to the Retained Earnings account. Required Prepare journal entries to record the foregoing transactions and post to T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders' equity accounts. Prepare the December 31 stockholders' equity section of the balance sheet.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Attend all
Transcribed Image Text:Stockholders' Equity: Transactions and Balance Sheet Presentation
The stockholders' equity accounts of Willis Corporation at January 1 appear below:
8 Percent preferred stock, $10 par value, 50,000 shares authorized;
6,800 shares issued and outstanding
Common stock, $10 par value, 200,000 shares authorized;
50,000 shares issued and outstanding
$68,000
500,000
Paid-in capital in excess of par value-Preferred stock
68,000
Paid-in capital in excess of par value-Common stock
Retained earnings
200,000
270,000
During the year, the following transactions occurred:
Jan. 10 Issued 35,000 shares of common stock for $18 cash per share,
23 Purchased 10,000 shares of common stock as treasury stock at $19 per share.
Mar. 14 Sold one-half of the treasury shares acquired January 23 for $21 per share.
July 15 Issued 3,500 shares of preferred stock in exchange for equipment with a fair market value of $128,000.
Nov. 15 Sold 1,000 of the treasury shares acquired January 23 for $24 per share.
Dec. 31 Closed the net income of $59,000 to the Retained Earnings account.
Required
Prepare journal entries to record the foregoing transactions and post to T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate
amount to the Retained Earnings T-account. Determine the ending balances for the stockholders' equity accounts.
Prepare the December 31 stockholders' equity section of the balance sheet.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education