Financial Accounting 202-Instructor: HarrisExam 3A Winter 2018 1. COMMON STOCK A

Question

Financial Accounting 202-Instructor: HarrisExam 3A Winter 2018 1. COMMON STOCK AND PREFERRED STOcK (36 POINTS $1 par value common. The following transactions affect during 2012, its first year of operations (15) points) January 1 Issuc 200,000 shares of common stk for Sfok for S1 Fobruary 6 Issue 1,000 shares of ostober N 12 Reissu bskosk for S18 par share. ember 12 Repurchasc Reissue 5,000 shares of treasury stock at $20 per share. oach of these transactions (omit descriptions and account numbers) PAGE- GENERAL JOURNAL POST REF? DEBIT CREDIT DATE DESCRIPTION 2

Explanation / Answer

Solution 1A:

Solution 1B:

Solution 2A:

Journal Entries Date Particulars Debit Credit 1-Jan Cash Dr (200,000*$15) $3,000,000.00       To Common Stock (200,000*$1) $200,000.00       To Paid in capital in excess of Par- Common Stock $2,800,000.00 (to record issue of common stock) 6-Feb Cash Dr (1,000*$11) $11,000.00       To 8% Preferred Stock (1,000*$10) $10,000.00       To Paid in capital in excess of Par- Preferred Stock $1,000.00 (To record issue of Preferred stock) 10-Oct Treasury Stock Dr (10,000*$18) $180,000.00          To Cash $180,000.00 (To record purchase of treasury stock) 12-Nov Cash Dr (5,000*$20) $100,000.00          To Treasury Stock (5,000*$18) $90,000.00          To Paid in Capital- Treasury Stock $10,000.00 (To record reissue of 5000 shares of treasury stock)

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