Question

Problem 15-1 On January 5, 2017, Skysong Corporation received a charter granting the right to issue 5,500 shares of $100 par value, 7% cumulative and nonparticipating preferred stock, and 48,400 shares of $10 par value common stock. It then completed these transactions. Jan. 11 Issued 21,900 shares of common stock at $16 per share. Feb. 1 Issued to Sanchez Corp. 3,900 shares of preferred stock for the following assets: equipment with a fair value of $50,800; a factory building with a fair value of $169,000; and land with an appraised value of $294,000. 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 $14 per share. Dec. 31 Declared a $0.30 per share cash dividend on the common stock and declared the preferred dividend. Dec. 31 Closed the Income Summary account. There was a $173,800 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.) Date Account Titles and Explanation Debit Credit Feb. 1 Aug. 10 Prepare the stockholders’ equity section of Skysong Corporation’s balance sheet as of December 31, 2017. (Enter account name only and do not provide descriptive information.) SKYSONG CORPORATION Stockholders’ Equity $ $ $

Answer 1

Ques 1

Jan-11	Cash	350,400
	Common Stock		219,000
	Paid in capital in excess of par - common		131,400
Feb-01	Land	50,800
	Buildings	169,000
	Machinery	294,000
	Preferred Stock		390,000
	Paid-In Capital in Excess of Par -Preferred		123,800
Jul-29	Treasury stock	32,400
	cash		32,400
Aug-10	Cash	25,200
	Paid in capital in excess of par - common	7,200
	Treasury stock(1800*18)		32400
Dec-31	Retained   Earnings	33,870
	Common Dividend Payable		6,570
	Preferred Dividend Payable		27,300
Dec-31	Income Summary	173,800
	Retained Earnings		173,800
	Notes
	preferred dividends	27300
	(3900 shares * 100 *7%)
	Common stock	6570
	(21900 shares - 1800 +1800)*$0.30

Ques 2

Stockhoders equity
Preferred stock , $100 par , 7% cumulative
nonparticipating, 5500 shares authorized, 3900
shares issued	390,000
Paid-in capital in excess of par, preferred stock	123,800	513,800
Common stock, $10 par value, 48,400 shares authorized, 21900 issued	219,000
Paid-in capital in excess of par, common stock	124,200	343,200
Total paid-in capital		857,000
Retained earnings (173800-33870)		139,930
Total stockholders’ equity		996,930