Reference no: EM132547793

Question -

A) A company is authorized to issue 50,000 shares of $50 par, 10%, noncumulative, nonparticipating preferred stock and 500,000 shares of no-par common stock. Prepare journal entries to record the following selected transactions that occurred during this year:

April 1: Issued 1,000 shares of common stock for $30 Cash Per share.

April 15: Exchanged 2,000 shares of preferred stock for equipment and merchandise inventory with market values of $ 90,000 and $ 20,000 ,respectively.

B) On July 31, a company declared a cash dividend of $0.25 per common share to the shareholders of record on August 15. The cash dividend will be paid on August 25.

This company has 500,000 shares authorized and 100,000 shares outstanding.

Prepare the journal entries required on July 31 and August 25.

B) A company's only treasury stock transactions for the current year follow: (1) 1,000 shares of its common stock were purchased on June 1 for $40,000; (2) On July 1 it reissued 500 of these shares at $45 per share; (3) On August 1 it reissued the 500 remaining treasury shares at $38 per share.

1) Prepare the journal entries required to record these transactions.

2) Calculate the balance in Paid-in Capital, Treasury Stock, on September 1 assuming its beginning-year balance is zero.