Chapter 10, Problem 10.46BE

(Learning Objectives 2, 3, 4: Account for issuance of stock; show how treasury stock affects a company; account for dividends) At December 31, 2018, Creator Corporation reported the stockholders’ equity accounts shown here (with dollar amounts in millions, except per-share amounts).

Common stock $2.00 par value per share, 23 million shares issued…………….	$46
Paid-in capital in excess of par value……	58
Retained earnings……………….	285
Treasury stock, at cost………………	(70)
Total stockholders’ equity……………..	$319

Creator’s 2019 transactions included

1. a. Net income, $451 million
2. b. Issuance of 22 million shares of common stock for $14.50 per share
3. c. Purchase of 10 million shares of treasury stock for $130 million
4. d. Sold 3 million of the treasury shares purchased in part c for $45 million
5. e. Declaration and payment of cash dividends of $28 million

Requirements

1. 1. Journalize Creator’s transactions in parts b, c, d, and e. Explanations are not required.
2. 2. What was the overall effect of these transactions (parts a through e) on Creator’s stockholders’ equity?