Question

Selected Stock Transactions

The following selected accounts appear in the ledger of Parks Construction Inc. at the beginning of the current year:

Preferred 2% Stock, $175 par (60,000 shares authorized, 30,000 shares issued)	$5,250,000
Paid-In Capital in Excess of Par—Preferred Stock	1,050,000
Common Stock, $25 par (500,000 shares authorized, 330,000 shares issued)	8,250,000
Paid-In Capital in Excess of Par—Common Stock	1,070,000
Retained Earnings	33,114,000

During the year, the corporation completed a number of transactions affecting the stockholders' equity. They are summarized as follows:

1. Issued 50,000 shares of common stock at $31, receiving cash.
2. Issued 15,000 shares of preferred 2% stock at $190.
3. Purchased 30,000 shares of treasury common for $29 per share.
4. Sold 15,000 shares of treasury common for $32 per share.
5. Sold 10,000 shares of treasury common for $27 per share.
6. Declared cash dividends of $3.50 per share on preferred stock and $0.10 per share on common stock.
7. Paid the cash dividends.

Required:

Journalize the entries to record the transactions.

For a compound transaction, if an amount box does not require an entry, leave it blank.

a. Issued 50,000 shares of common stock at $31, receiving cash.

		fill in the blank c6c842fccf8804c_2	fill in the blank c6c842fccf8804c_3
		fill in the blank c6c842fccf8804c_5	fill in the blank c6c842fccf8804c_6
		fill in the blank c6c842fccf8804c_8	fill in the blank c6c842fccf8804c_9

b. Issued 15,000 shares of preferred 2% stock at $190.

		fill in the blank ee1e8afeefa906a_2	fill in the blank ee1e8afeefa906a_3
		fill in the blank ee1e8afeefa906a_5	fill in the blank ee1e8afeefa906a_6
		fill in the blank ee1e8afeefa906a_8	fill in the blank ee1e8afeefa906a_9

c. Purchased 30,000 shares of treasury common for $29 per share..

		fill in the blank 06f28e011fd7056_2
			fill in the blank 06f28e011fd7056_4

d. Sold 15,000 shares of treasury common for $32 per share.

		fill in the blank 315e62f81ff4f7f_2	fill in the blank 315e62f81ff4f7f_3
		fill in the blank 315e62f81ff4f7f_5	fill in the blank 315e62f81ff4f7f_6
		fill in the blank 315e62f81ff4f7f_8	fill in the blank 315e62f81ff4f7f_9

e. Sold 10,000 shares of treasury common for $27 per share.

		fill in the blank ae4d55fb2fec030_2	fill in the blank ae4d55fb2fec030_3
		fill in the blank ae4d55fb2fec030_5	fill in the blank ae4d55fb2fec030_6
		fill in the blank ae4d55fb2fec030_8	fill in the blank ae4d55fb2fec030_9

f. Declared cash dividends of $3.5 per share on preferred stock and $0.1 per share on common stock.

		fill in the blank 57b294ffb001fcb_2
			fill in the blank 57b294ffb001fcb_4

g. Paid the cash dividends.

		fill in the blank 10d65c086ffbff2_2
			fill in the blank 10d65c086ffbff2_4

Answer 1

Date	particulars	Debit amount	Credit amount	Assets	Liabilities	equity
A	cash(50000×31)	$1550000		$1550000
	To common stock(50000×25)		$1250000			$1250000
	To paid in capital in excess of par - common stock		$300000			$300000
	[To record the issuance of common stock]
B	cash (15000×190)	$2850000		$2850000
	To preferred stock(15000×175)		$2625000			$2625000
	To paid in capital excess of parpar-preferred stock		$225000			$225000
	[To record the issuance of preferred stock]
C	Treasury stock (30000×29)	$870000				-$870000
	To cash		$870000	$-870000
	[To record the purchase of treasury stock]
D	cash(15000×32)	$480000		$480000
	To treasury stock(15000×29)		$435000			$435000
	To paid in capital from sale of treasury stock		$45000			$45000
	[To record the reissuance of treasury stock)]
E	cash(10000×27)	$270000		$270000
	Paid in capital from sale of treasury stock	$20000				$-20000
	To treasury stock(10000×29)		$290000			$290000
	[To record the reissuance of treasury stock]
F	cash dividend (retained earnings)[ {(30000+15000)×3.5}+{(330000+50000-30000+15000+10000)×0.10}]	$1612500				$-1612500
	To cash dividend payable		$1612500		$1612590
	[To record the declaration of cash dividend]
G	cash dividend payable	$1612500			$-1612500
	To cash		$1612500	$-1612500
	[To record the payment of dividend]