Question

^{When FS Industries had its initial public offering on March 1st, it issued all of its 1,550,000 authorized $1 par value common stock shares, receiving $30 per share. After analyzing its first quarters’ results of operations, FS declared a cash dividend on June 15th. Stockholders on record at July 31st are to receive $1.25 per share. FS paid the cash dividend on August 30th. FS reacquired 310,000 of its own shares of stock for cash of $35 per share on September 22nd when their second quarters’ earnings came in much lower than expected. Management wanted to improve the shareholders earnings per share by doing this. On November 4th, FS resold 155,000 of these shares for $41 per share when the third quarter results of operations bounced back.}

Required:

1. Prepare all of the necessary journal entries to record the events described above.
2. Prepare the stockholders' equity section of the balance sheet as of November 30 assuming that the net income for the first three quarters totaled $8,000,000.

Answer 1