On January 5, 2020, Waterway Corporation received a charter granting the right to issue 5,100 shares...

On January 5, 2020, Waterway Corporation received a charter granting the right to issue 5,100 shares of $100 par value, 9% cumulative and nonparticipating preferred stock, and 50,000 shares of $10 par value common stock. It then completed these transactions.

Jan. 11		Issued 20,700 shares of common stock at $17 per share.
Feb. 1		Issued to Sanchez Corp. 3,600 shares of preferred stock for the following assets: equipment with a fair value of $52,200; a factory building with a fair value of $163,000; and land with an appraised value of $297,000.
July 29		Purchased 1,800 shares of common stock at $18 per share. (Use cost method.)
Aug. 10		Sold the 1,800 treasury shares at $15 per share.
Dec. 31		Declared a $0.35 per share cash dividend on the common stock and declared the preferred dividend.
Dec. 31		Closed the Income Summary account. There was a $174,100 net income.

Record the journal entries for the transactions listed above. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record entries in the order displayed in the problem statement. Round answers to 0 decimal places, e.g. $5,275.)

Prepare the stockholders’ equity section of Waterway Corporation’s balance sheet as of December 31, 2020. (Enter account name only and do not provide descriptive information.)

Expert Solution

Journal Entries of the Trasactions:

Stack holders Equity section statement as on 31 of Water way corporation

Working notes:

here:

Treasury stock account has been settled just see the journal entries and the there is an income summary which is transferred to Retained earnings account.

Retained earnings = 174100+5400=179500

Having any queries just post it on comment section in which part you didn't get it.

ekkarill92 answered 2 years ago

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