/The tollowing information applies to the questions displayed below Mgor Leegue

Question

/The tollowing information applies to the questions displayed below Mgor Leegue Apparel hes two clesses of stock authorized 6%$t0 per prefered,and St par vake common The Jenuary 2 Issue 110.000 shares of common stock for $58 per share February M Issue 41000 shares of pretered shock for $12 per share May 8 Repurchane 11,000 shares of its own common stock for $41 per share May 31 Reissue 5.500 sheres of treasury stock for $46 per share acash dividens on its common stock of SO 30 per share and $24600?%ofpar value, cash dMdend on its preferred stock payaie to al stocítiders of record on December 30 (Hint Dividends are not ped on treasury stock) December 30 Pay the cesh dividends decdared on December t

Explanation / Answer

Journal Entries Date Account Title and explanation Debit Credit January, 02 Cash $                56,10,000      To Common Share Capital (110,000 Shares X $ 1) $                1,10,000       To addittional paid in capital - Common Stock $              55,00,000 (To Record the issue of share capital ) Feb, 14 Cash ( 41,000 Shares X $ 12) $                  4,92,000      To Preferred Share Capital (41,000 Shares X $ 10) $                4,10,000       To Addittional paid in capital - Preferred Stock $                    82,000 (To Record the issue of preferred share capital ) Treasurry Stock (11,000 Shares X $ 41) $                  4,51,000 May, 08     To Cash $                4,51,000 (To record the purchase of treasurry stock) Cash (5500 Shares X $ 46) $                  2,53,000 May , 31      To Treasurry Stock (5500 Shares X $ 41) $                2,25,500       To Addittional Paid in capital - Treasurry stock $                    27,500 Dec, 01 Dividend - Common Shares $                      46,200 Dividend - Preferred Shares $                      24,600      To Dividend Payable $                    70,800 (To Record the dividend payable) Total Common Shares =                      1,10,000 Less: Purchase under treasurry                          11,000 Add: Reissue under treasurry                          55,000 Eligible for Dividend                      1,54,000 Dividend per shares $                          0.30 Total Dividend $                      46,200 Dec, 30 Dividend Payable $                      70,800       To Cash $                    70,800 (To Record the cash dividend paid) STOCKHOLDERS EQUITY SECTION Issue Common Shares at(154,000 Shares at $ 1 Par )                1,54,000.00 Preferred Shares                4,10,000.00 Addittional paid in capital - Common Stock              55,00,000.00 Addittional paid in capital - Preferred Stock                    82,000.00 Less: Treasurry Stock                2,25,500.00 Addittional paid in capital - Treasurry Stock                    27,500.00 Total Stockholders Equity              58,93,000.00

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