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Whispering Company reported the following amounts in the stockholders' equity section of its December 31, 2024, balance sheet: Preferred stock, 12%, $100 par ( 100,000 shares authorized, 22,000 shares issued) Common stock, $1 par (1,000,000 shares authorized, 300,000 shares issued) Additional paid-in capital-common Retained earnings $2,200,000 300,000 900,000 1,280,000

Whispering Company reported the following amounts in the stockholders' equity section of its December 31, 2024, balance sheet: Preferred stock, 12%, $100 par ( 100,000 shares authorized, 22,000 shares issued) Common stock, $1 par (1,000,000 shares authorized, 300,000 shares issued) Additional paid-in capital-common Retained earnings $2,200,000 300,000 900,000 1,280,000

FINANCIAL ACCOUNTING
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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Intermediate Accounting 105

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The image provides details of Whispering Company's stockholders' equity and related transactions for the year ending December 31, 2024, and transactions during 2025. Here's the transcription suitable for an educational website: --- ### Whispering Company Stockholders' Equity Overview (As of December 31, 2024) **Balance Sheet Items:** - **Preferred Stock: 12%, $100 par** - Authorized: 100,000 shares - Issued: 22,000 shares - Total: $2,200,000 - **Common Stock: $1 par** - Authorized: 1,000,000 shares - Issued: 300,000 shares - Total: $300,000 - **Additional Paid-in Capital - Common:** - Total: $900,000 - **Retained Earnings:** - Total: $1,280,000 **Total Stockholders' Equity: $4,680,000** --- ### Transactions in 2025 1. **Dividend Payment:** - Paid annual 2024 dividend on preferred stock and a $0.50 per share dividend on common stock, as declared on December 31, 2024. 2. **Stock Repurchase:** - Purchased 1,100 shares of its own outstanding common stock for $8 per share using the cost method. 3. **Treasury Stock Reissue:** - Reissued 1,100 treasury shares for land worth $10,300. Common shares were trading at $8.50 per share. 4. **Issuance of Common Stock:** - Issued 50,000 shares of common stock at $9 per share. 5. **Stock Split:** - Declared and recorded a 2:1 stock split on the outstanding common stock, with shares trading at $10 per share. 6. **Dividend Declaration:** - Declared the annual 2025 dividend on preferred stock and the $0.50 per share dividend on common stock, payable in 2026. --- ### Journal Entries (Template for Recording Transactions) **Instructions: Prepare journal entries to record the transactions described above. Assume transactions occurred in the presented order. Credit account titles automatically indent when the amount is entered. If no entry is required, select "No Entry" and enter 0 for the amounts. List all debit entries before credit entries.
Transcribed Image Text:The image provides details of Whispering Company's stockholders' equity and related transactions for the year ending December 31, 2024, and transactions during 2025. Here's the transcription suitable for an educational website: --- ### Whispering Company Stockholders' Equity Overview (As of December 31, 2024) **Balance Sheet Items:** - **Preferred Stock: 12%, $100 par** - Authorized: 100,000 shares - Issued: 22,000 shares - Total: $2,200,000 - **Common Stock: $1 par** - Authorized: 1,000,000 shares - Issued: 300,000 shares - Total: $300,000 - **Additional Paid-in Capital - Common:** - Total: $900,000 - **Retained Earnings:** - Total: $1,280,000 **Total Stockholders' Equity: $4,680,000** --- ### Transactions in 2025 1. **Dividend Payment:** - Paid annual 2024 dividend on preferred stock and a $0.50 per share dividend on common stock, as declared on December 31, 2024. 2. **Stock Repurchase:** - Purchased 1,100 shares of its own outstanding common stock for $8 per share using the cost method. 3. **Treasury Stock Reissue:** - Reissued 1,100 treasury shares for land worth $10,300. Common shares were trading at $8.50 per share. 4. **Issuance of Common Stock:** - Issued 50,000 shares of common stock at $9 per share. 5. **Stock Split:** - Declared and recorded a 2:1 stock split on the outstanding common stock, with shares trading at $10 per share. 6. **Dividend Declaration:** - Declared the annual 2025 dividend on preferred stock and the $0.50 per share dividend on common stock, payable in 2026. --- ### Journal Entries (Template for Recording Transactions) **Instructions: Prepare journal entries to record the transactions described above. Assume transactions occurred in the presented order. Credit account titles automatically indent when the amount is entered. If no entry is required, select "No Entry" and enter 0 for the amounts. List all debit entries before credit entries.
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