In: Accounting
The stockholders’ equity accounts of Whispering Winds Corp. on January 1, 2017, were as follows. Preferred Stock (7%, $100 par noncumulative, 4,650 shares authorized) $279,000 Common Stock ($5 stated value, 306,000 shares authorized) 1,274,999 Paid-in Capital in Excess of Par Value—Preferred Stock 13,950 Paid-in Capital in Excess of Stated Value—Common Stock 489,600 Retained Earnings 699,500 Treasury Stock (4,650 common shares) 37,200 During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity. Feb. 1 Issued 4,860 shares of common stock for $29,160. Mar. 20 Purchased 1,300 additional shares of common treasury stock at $8 per share. Oct. 1 Declared a 7% cash dividend on preferred stock, payable November 1. Nov. 1 Paid the dividend declared on October 1. Dec. 1 Declared a $0.70 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017. Dec. 31 Determined that net income for the year was $277,400. Paid the dividend declared on December 1. Journalize the transactions. (Record entries in the order displayed in the problem statement. 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. Round answers to 0 decimal places, e.g. 5,275.)
Journal entries | ||||||
S.no. | Accounts title and explanations | Debit $ | Credit $ | |||
01-Feb | Cash account | 29160 | ||||
Common Stock capital (4860*5) | 24300 | |||||
Paid in capital in excess of Statedvalue-Common | 4860 | |||||
(for stock issued at premium) | ||||||
20-Mar | Treasury stock (1300*8) | 10400 | ||||
Cash account | 10400 | |||||
(for purchase of treasury stock) | ||||||
01-Oct | Preferred dividend | 19530 | ||||
Pref. Dividend payable (2790*7) | 19530 | |||||
(for dividend declared) | ||||||
01-Nov | Pref. dividend payable | 19530 | ||||
Cash account | 19530 | |||||
(fo dividend paid ) | ||||||
01-Dec | Dividend account | 1,77,737 | ||||
Dividend payable (253910*0.70) | 1,77,737 | |||||
(for dividend declared) | ||||||
Dec-31 | Income summary | 2,77,400 | ||||
Retained earnings | 2,77,400 | |||||
(for net income) | ||||||
Dec-31 | Dividend payable | 1,77,737 | ||||
Cash account | 1,77,737 | |||||
(for dividend paid) | ||||||
Note: | ||||||
Stock outstanding: | ||||||
Beginning shares issued(1274999/5) | 255000 | |||||
Add: issued | 4860 | |||||
Less: Total Treasury stock (4650+1300) | -5950 | |||||
Shares outstanding | 253910 | |||||