The shareholders’ equity section of Superior Corporation’s balance sheet as of December 31, 2018, is as follows: Shareholders’ Equity Preferred stock, $100 par value; authorized, 300,000 shares; issued, 33,000 shares $3,300,000 Common stock, $5 par value; authorized, 2,000,000 shares; issued, 377,000 shares 1,885,000 Paid-in capital in excess of par—preferred 96,000 Paid-in capital in excess of par—common 825,000 Retained earnings 2,920,000 $9,026,000 The following events occurred during 2019: Jan. 5 10,500 shares of authorized and unissued common stock were sold for $7 per share. 16 10,000 shares of authorized and unissued preferred stock were sold for $108 per share. Apr. 1 79,000 shares of common stock were repurchased for the treasury at a price of $21 per share. Superior uses the cost method to account for treasury stock. Sept. 1 3,500 shares of preferred stock are issued in exchange for a piece of land. The land has an appraised value of $389,500. The preferred stock currently trades on the New York Stock Exchange at a price of $109 per share. Dec. 1 24,000 shares of treasury stock are reissued at a price of $24 per share. Required: 1. Prepare journal entries for each of the above transactions. 2. Calculate the number of authorized, issued, and outstanding common shares as of December 31, 2019. 3. Calculate Superior’s legal capital at December 31, 2019. CHART OF ACCOUNTSSuperior CorporationGeneral Ledger ASSETS 111 Cash 121 Accounts Receivable 141 Inventory 152 Prepaid Insurance 180 Land 181 Equipment 189 Accumulated Depreciation LIABILITIES 211 Accounts Payable 231 Salaries Payable 250 Unearned Revenue 261 Income Taxes Payable EQUITY 305 Preferred Stock 311 Common Stock 318 Additional Paid-in Capital on Preferred Stock 320 Additional Paid-in Capital on Common Stock 321 Additional Paid-in Capital on Treasury Stock 331 Retained Earnings 335 Treasury Stock REVENUE 411 Sales Revenue EXPENSES 500 Cost of Goods Sold 511 Insurance Expense 512 Utilities Expense 521 Salaries Expense 532 Bad Debt Expense 540 Interest Expense 541 Depreciation Expense 559 Miscellaneous Expenses 910 Income Tax Expense
The shareholders’ equity section of Superior Corporation’s balance sheet as of December 31, 2018, is as follows: Shareholders’ Equity Preferred stock, $100 par value; authorized, 300,000 shares; issued, 33,000 shares $3,300,000 Common stock, $5 par value; authorized, 2,000,000 shares; issued, 377,000 shares 1,885,000 Paid-in capital in excess of par—preferred 96,000 Paid-in capital in excess of par—common 825,000 Retained earnings 2,920,000 $9,026,000 The following events occurred during 2019: Jan. 5 10,500 shares of authorized and unissued common stock were sold for $7 per share. 16 10,000 shares of authorized and unissued preferred stock were sold for $108 per share. Apr. 1 79,000 shares of common stock were repurchased for the treasury at a price of $21 per share. Superior uses the cost method to account for treasury stock. Sept. 1 3,500 shares of preferred stock are issued in exchange for a piece of land. The land has an appraised value of $389,500. The preferred stock currently trades on the New York Stock Exchange at a price of $109 per share. Dec. 1 24,000 shares of treasury stock are reissued at a price of $24 per share. Required: 1. Prepare journal entries for each of the above transactions. 2. Calculate the number of authorized, issued, and outstanding common shares as of December 31, 2019. 3. Calculate Superior’s legal capital at December 31, 2019. CHART OF ACCOUNTSSuperior CorporationGeneral Ledger ASSETS 111 Cash 121 Accounts Receivable 141 Inventory 152 Prepaid Insurance 180 Land 181 Equipment 189 Accumulated Depreciation LIABILITIES 211 Accounts Payable 231 Salaries Payable 250 Unearned Revenue 261 Income Taxes Payable EQUITY 305 Preferred Stock 311 Common Stock 318 Additional Paid-in Capital on Preferred Stock 320 Additional Paid-in Capital on Common Stock 321 Additional Paid-in Capital on Treasury Stock 331 Retained Earnings 335 Treasury Stock REVENUE 411 Sales Revenue EXPENSES 500 Cost of Goods Sold 511 Insurance Expense 512 Utilities Expense 521 Salaries Expense 532 Bad Debt Expense 540 Interest Expense 541 Depreciation Expense 559 Miscellaneous Expenses 910 Income Tax Expense
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 5MC: Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par...
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The shareholders’ equity section of Superior Corporation’s balance sheet as of December 31, 2018, is as follows:
Shareholders’ Equity | |
$3,300,000 | |
Common stock, $5 par value; authorized, 2,000,000 shares; issued, 377,000 shares | 1,885,000 |
Paid-in capital in excess of par—preferred | 96,000 |
Paid-in capital in excess of par—common | 825,000 |
2,920,000 | |
$9,026,000 |
The following events occurred during 2019:
Jan. 5 | 10,500 shares of authorized and unissued common stock were sold for $7 per share. |
16 | 10,000 shares of authorized and unissued preferred stock were sold for $108 per share. |
Apr. 1 | 79,000 shares of common stock were repurchased for the treasury at a price of $21 per share. Superior uses the cost method to account for |
Sept. 1 | 3,500 shares of preferred stock are issued in exchange for a piece of land. The land has an appraised value of $389,500. The preferred stock currently trades on the New York Stock Exchange at a price of $109 per share. |
Dec. 1 | 24,000 shares of treasury stock are reissued at a price of $24 per share. |
Required:
1. | Prepare |
2. | Calculate the number of authorized, issued, and outstanding common shares as of December 31, 2019. |
3. | Calculate Superior’s legal capital at December 31, 2019. |
CHART OF ACCOUNTSSuperior CorporationGeneral Ledger
ASSETS | |
111 | Cash |
121 | |
141 | Inventory |
152 | Prepaid Insurance |
180 | Land |
181 | Equipment |
189 |
LIABILITIES | |
211 | Accounts Payable |
231 | Salaries Payable |
250 | Unearned Revenue |
261 | Income Taxes Payable |
EQUITY | |
305 | Preferred Stock |
311 | Common Stock |
318 | Additional Paid-in Capital on Preferred Stock |
320 | Additional Paid-in Capital on Common Stock |
321 | Additional Paid-in Capital on Treasury Stock |
331 | Retained Earnings |
335 | Treasury Stock |
REVENUE | |
411 | Sales Revenue |
EXPENSES | |
500 | Cost of Goods Sold |
511 | Insurance Expense |
512 | Utilities Expense |
521 | Salaries Expense |
532 | |
540 | Interest Expense |
541 | Depreciation Expense |
559 | Miscellaneous Expenses |
910 | Income Tax Expense |
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