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In: Accounting

Jan. 5. JOURNALIZE THE ENTRIES. Split the common stock 4 for 1 and reduced the par...

Jan.

5.

JOURNALIZE THE ENTRIES.

Split the common stock 4 for 1 and reduced the par from $20 to $5 per share. After the split, there were 4,000,000 common shares outstanding.

Mar. 10. Purchased 100,000 shares of the corporation’s own common stock at $30, recording the stock at cost.
Apr. 30. Declared semiannual dividends of $0.25 on 30,000 shares of preferred stock and $0.08 on the common stock to stockholders of record on May 15, payable on June 15.
June 15. Paid the cash dividends.
Aug. 20. Sold 60,000 shares of treasury stock at $40, receiving cash.
Oct. 15. Declared semiannual dividends of $0.25 on the preferred stock and $0.08 on the common stock (before the stock dividend). In addition, a 1% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $35. The dividend date of record is November 15 payable on December 19.
Dec. 19.

Paid the cash dividends and issued the certificates for the common stock dividend.

CHART OF ACCOUNTS
ATV Discount Corporation
General Ledger
ASSETS
110 Cash
120 Accounts Receivable
131 Notes Receivable
132 Interest Receivable
141 Merchandise Inventory
145 Office Supplies
151 Prepaid Insurance
181 Land
193 Equipment
194 Accumulated Depreciation-Equipment
LIABILITIES
210 Accounts Payable
221 Notes Payable
226 Interest Payable
231 Cash Dividends Payable
241 Salaries Payable
261 Mortgage Note Payable
EQUITY
311 Common Stock
312 Paid-In Capital in Excess of Par-Common Stock
315 Treasury Stock
321 Preferred Stock
322 Paid-In Capital in Excess of Par-Preferred Stock
331 Paid-In Capital from Sale of Treasury Stock
340 Retained Earnings
350 Stock Dividends Distributable
351 Cash Dividends
352 Stock Dividends
390 Income Summary
REVENUE
410 Sales
610 Interest Revenue
EXPENSES
510 Cost of Merchandise Sold
515 Credit Card Expense
520 Salaries Expense
531 Advertising Expense
532 Delivery Expense
533 Selling Expenses
534 Rent Expense
535 Insurance Expense
536 Office Supplies Expense
537 Organizational Expenses
562 Depreciation Expense-Equipment
590 Miscellaneous Expense
710 Interest Expense

Journalize the entries

Solutions

Expert Solution

Journal Entries :-

Date Particulars Debit($) Credit($)
Jan. 5 Comman Stock @ $20 a/c Dr. 80000000
To Common Stock @ $5 a/c 80000000
Mar. 10 Trasury Stock A/c Dr. 3000000
To Cash A/c (100000*$30) 3000000
April 30 Common Dividend Declared a/c Dr ((4000000-100000)*$0.08) 312000
Preferred Dividend Declared a/c Dr. (30000*$0.25) 7500
To Common Dividend Payable A/c 312000
To Preferred Dividend Payable A/c 7500
Jun 15 Common Dividend Payable A/c Dr. 312000
Preferred Dividend Payable a/c Dr. 7500
To Cash A/c 328500
Aug. 20 Cash A/c Dr. (60000*$40) 2400000
To Treasury Stock A/c ($2400000*(60000/100000)) 1440000
To additional Paid in Capital A/c 960000
Oct 15

Common Dividend Declared A/c Dr. (4000000-100000+60000)*$0.08

316800
Preferred Dividend Declared A/c Dr. (30000*$0.25) 7500
To Common Dividend Payable a/c 316800
To Preferrd Dividend Payable A/c 7500
Oct 15 Retained Earnings A/c Dr.(3960000*$35*1%) 1386000
To Common Stock Dividend Distributable A/c(3960000*$5*1%) 198000
To Paid in Capital in Excess of Par A/c(3960000*$30*1%) 1188000
Dec 19 Common Dividend Payable a/c Dr. 316800
Preferred Dividend Payable a/c Dr. 7500
To Cash A/c 324300
Dec. 19 Common Stock Dividend Distributable A/c Dr. 1386000
To Common Stock A/c 1386000

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