C-Mobile Wireless needed additional capital to expand so the business incorporat
ID: 2396455 • Letter: C
Question
C-Mobile Wireless needed additional capital to expand so the business incorporated. The charter from the state of Georgia authorizes C-Mobile to issue 60,000 shares of 8%, $50 par value cumulative preferre stock and 160,000 shares of $4 par value common stock. During the first month, C- Mobile completed the following transactions Click the icon to view the transactions.) Read the reguirements. More Info Oct 25: Paid the cash dividend. Date Accounts and Explanation Debit Credit Oct. 2 Issued 21,000 shares of common stock for a building with a market value Oct. 25 of $210,000 6 Issued 550 shares of preferred stock for $100 per share 9 Issued 10,000 shares of common stock for cash of $50,000 10 Declared a $13,000 cash dividend for stockholders of record on Oct. 20 Use a separate Dividends Payable account for preferred and common stock 25 Paid the cash dividend Requirement 2. Prepare the stockholders' equity section of C-Mobile's balance sheet at October 31, 2018. Assum PrintDone C-Mobile Wireless Balance Sheet (Partial) October 31, 2018 Stockholders' Equity Paid-In Capital: Requirements 1. 2. Record the transactions in the general journal. Prepare the stockholders' equity section of C-Mobile's balance sheet at October 31, 2018. Assume C Mobile's net income for the month was $91,000 Total Paid-In Capital Print Done Total Stockholders EquityExplanation / Answer
Answer:
1
Date
Accounts and Explanation
Debit
Credit
Oct. 2
Building
210,000
Common Stock—$4 Par Value($4 per share × 21,000 shares)
84,000
Paid-In Capital in Excess of Par—Common ($210,000– $84,000)
126,000
Issued common stock for building
6
Cash ($100 per share × 550 shares)
55,000
Preferred Stock—$50 Par Value($50 per share × 550 shares)
27,500
Paid-In Capital in Excess of Par—Preferred ($55,000 ? $27,500)
27,500
Issued preferred stock for cash
9
Cash
50,000
Common Stock—$4 Par Value($4 per share × 10,000 shares)
40,000
Paid-In Capital in Excess of Par—Common ($50,000 – $40,000)
10,000
Issued common stock for cash
10
Cash Dividends
13,000
Dividends Payable—Preferred
2,200
Dividends Payable—Common
10,800
Declared cash dividend.*
25
Dividends Payable—Preferred
2,200
Dividends Payable—Common
10,800
Cash
13,000
Paid cash dividend.
Working for the devinded
*
*Total Dividend
13000
Dividend to Preferred Stockholders
(8%*50*550)
2200
Dividend to Common Stockholders
10800
__________________________________________________________________
2
C-CELL WIRELESS
Balance Sheet (Partial)
31-Oct-18
Stockholders’ Equity
Paid-In Capital:
Cumulative Preferred Stock—8%, $50 Par Value; 60,000 shares authorized, 550 shares issued and outstanding
$27,500
Paid-In Capital in Excess of Par—Preferred
$27,500
Common Stock—$4 Par Value; 160,000 shares authorized, 31,000 shares issued and outstanding
124,000
Paid-In Capital in Excess of Par—Common
136,000
Total Paid-In Capital
315,000
Retained Earnings*
78,000
Total Stockholders’ Equity
$393,000
*income $91,000 – Dividends $13,000 = $78,000
Date
Accounts and Explanation
Debit
Credit
Oct. 2
Building
210,000
Common Stock—$4 Par Value($4 per share × 21,000 shares)
84,000
Paid-In Capital in Excess of Par—Common ($210,000– $84,000)
126,000
Issued common stock for building
6
Cash ($100 per share × 550 shares)
55,000
Preferred Stock—$50 Par Value($50 per share × 550 shares)
27,500
Paid-In Capital in Excess of Par—Preferred ($55,000 ? $27,500)
27,500
Issued preferred stock for cash
9
Cash
50,000
Common Stock—$4 Par Value($4 per share × 10,000 shares)
40,000
Paid-In Capital in Excess of Par—Common ($50,000 – $40,000)
10,000
Issued common stock for cash
10
Cash Dividends
13,000
Dividends Payable—Preferred
2,200
Dividends Payable—Common
10,800
Declared cash dividend.*
25
Dividends Payable—Preferred
2,200
Dividends Payable—Common
10,800
Cash
13,000
Paid cash dividend.
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