A. Issued 3500 shares of $10 par common stock at $11, receiving cash. B. Issued $ 70000 of 10 year 10% bonds at a market (effective) interest rate of 9%, with interest payable semiannually. Use the Present Value Tables in Appendix A of text book. Round all calculations to the nearest dollar. C. Declared a dividend of $0.25 per share on common stock. On date of declaration, 11200 shares of common stock were outstanding. D. Paid cash dividend from (c) above.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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1. Record the JOURNAL ENTRIES:

Entries:

A. Issued 3500 shares of $10 par common stock at $11, receiving cash.

B. Issued $ 70000 of 10 year 10% bonds at a market (effective) interest rate of 9%, with interest payable semiannually. Use the Present Value Tables in Appendix A of text book. Round all calculations to the nearest dollar.

C. Declared a dividend of $0.25 per share on common stock. On date of declaration, 11200 shares of common stock were outstanding.

D. Paid cash dividend from (c) above.

E. Purchased 4200 shares of Jones Company for $10 per share, plus $2100 commission. Our company purchased less than 20% of the outstanding stock of Jones Company.

F. Declared a 5% stock dividend on the $10 par common stock when the (6 points) market price was $ 25 per share. There were 11200 Shares outstanding.

G. Distributed the stock dividends declared in (F).

H. Purchased $5000 of 5% bonds at par. Interest is payable semiannually.

I. Purchased 210 shares of treasury common stock for $12 per share.

J. Received semiannual interest from bonds purchased in (H).

K. Received a total cash dividend of $420 from Jones Company.

L. Received a $700 dividend from our investment in Masco Company stock. This investment is accounted for under the equity method.

M. Sold, at $17 per share, 105 shares of treasury common stock purchased in (I).

N. Sold 840 shares of Jones company stock purchased in (E) for $13 per share, including commission.

O. Masco Company's total earnings are $35000. We own 40%. Record the earnings for our company using the equity method.

P. Sold the bonds purchased in (H) at 103 plus $63 in accrued interest.

Q. At the end of the accounting period, the remaining shares of Jones Company stock increased $2.00 per share

R. Record the payment of semiannual interest on the bonds issued in (B) and the amortization of the premium for six months. The amortization is determined using the straight-line method. Round all calculations to the nearest dollar.

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