Goodings, Inc. has two classes of stock authorized: 8%, $20 par value preferred and $1 par...

Goodings, Inc. has two classes of stock authorized: 8%, $20 par value preferred and $1 par value common. The following transactions affect stockholders' equity during 2018, its first year of operations:

February 2 - Issue 1 million shares of common stock for $20 per share.

February 4 Issue 50,000 shares of preferred stock for $21 per share.

June 15 Purchase 100,000 shares of its own common stock for $18 per share.

August 15 Reissue 75,000 shares of treasury stock for $23 per share.

November 1 Declare a cash dividend on its preferred stock and a $1 per share cash dividend on its common stock to all stockholders on record on November 15.

November 30 Pay the dividends declared on November 1.

Record the journal entry for each of these transactions.

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Expert Solution

Date	Accounting titles and Explanations				Debit	Credit


Feb	Cash	(1,000,000*20)=			20,000,000
	Common Stock		(1,000,000*1)			1,000,000
	paid in capital in excess of par					19,000,000

4-Feb	Cash	(50,000*21)			1,050,000
	Preferred Stock		(50,000*20)			1,000,000
	paid in capital in excess of par					50,000


15-Jun	Treasusry stock				1800000
	cash	(100,000*18)				1800000


15-Aug	Cash	(75000*23)			1725000
	Treasury stock		(75000*18)			1350000
	paid in excess on Treasury stock (75000*5)					375000


1-Nov	Cash dividend/Retained earnings				1,055,000
	Dividends payable - preferred			(50,000208%)		80000
	Dividends payable - common			(975000*1)		975,000


30-Nov	Dividends payable		-preferred		80,000
	Dividends payable		- common		975,000
	cash					1,055,000

ekkarill92 answered 1 year ago

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