Zinnia Company: Zinnia Company incorporated on January 1, 2017. The company had

Question

Zinnia Company: Zinnia Company incorporated on January 1, 2017. The company had authorized 1,500,000 shares of common stock, with a par value of $5 per share. The company had the following transactions during 2017: Issued 50,000 shares of common stock for $8 per share. Repurchased 5,000 shares of their common stock for $7 per share. Declared a $.50 per share cash dividend to be paid on Dec. 30 to stockholders of record on Jan. 15 Sept. 1 Nov. 1 Dec. 1 Required: 1. Prepare the necessary journal entries to record the above transactions. (12 points) Date Account Titles DebitCredit

Explanation / Answer

Date Account titles Debit Credit 15-Jan Cash 400000 common stock (50,000*5) 250000 paid in capital in excess of par 150000 1-Sep Treasury stock 35000 Cash (5000*7) 35,000 1-Nov Cash dividend 22,500 Dividends payable 22,500 (50000-5000)*.50

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