Chapter 20, Problem 6SPB

PAR AND NO-PAR, COMMON AND PREFERRED STOCK Valdez Company had the following stock transactions during the first 5 years of operations:

1. (a) Issued 24,000 shares of $1 par common stock for $26,000 cash.
2. (b) Issued 18,000 shares of $1 par common stock for $18,000 cash.
3. (c) Issued 3,000 shares of $10 par, 7% preferred stock for $30,000 cash.
4. (d) Issued 4,500 shares of $10 par, 7% preferred stock for $46,500 cash.
5. (e) Issued 1,800 shares of no-par common stock for $10,475 cash.
6. (f) Issued 1,100 shares of no-par, $7 preferred stock for $32,000 cash.

REQUIRED

1. 1. Prepare general journal entries for these transactions, identifying each by letter.
2. 2. Assume that stock transactions a, b, and c occurred in year 1. The amount available for dividends at the end of year 1 is $12,600. Prepare the dividend allocation between the preferred and common shares in total and per share for year 1.