Sheffield Corporation is authorized to issue 23,000 shares of $50 par value, 10% preferred stock and 125,000 shares of $5 par value common stock. On January 1, 2020, the ledger contained the following stockholders’ equity balances. Preferred Stock (11,500 shares) $575,000 Paid-in Capital in Excess of Par—Preferred Stock 67,000 Common Stock (62,000 shares) 310,000 Paid-in Capital in Excess of Par—Common Stock 650,000 Retained Earnings 280,000 During 2020, the following transactions occurred. Feb. 1 Issued 2,000 shares of preferred stock for land having a fair value of $129,000. Mar. 1 Issued 1,200 shares of preferred stock for cash at $65 per share. July 1 Issued 17,000 shares of common stock for cash at $7 per share. Sept. 1 Issued 550 shares of preferred stock for a patent. The asking price of the patent was $32,000. Market price for the preferred stock was $70 and the fair value for the patent was indeterminable. Dec. 1 Issued 7,500 shares of common stock for cash at $7.50 per share. Dec. 31 Net income for the year was $260,000. No dividends were declared. 1. Journalize the transactions and the closing entry for net income
Sheffield Corporation is authorized to issue 23,000 shares of $50 par value, 10% preferred stock and 125,000 shares of $5 par value common stock. On January 1, 2020, the ledger contained the following stockholders’ equity balances. Preferred Stock (11,500 shares) $575,000 Paid-in Capital in Excess of Par—Preferred Stock 67,000 Common Stock (62,000 shares) 310,000 Paid-in Capital in Excess of Par—Common Stock 650,000 Retained Earnings 280,000 During 2020, the following transactions occurred. Feb. 1 Issued 2,000 shares of preferred stock for land having a fair value of $129,000. Mar. 1 Issued 1,200 shares of preferred stock for cash at $65 per share. July 1 Issued 17,000 shares of common stock for cash at $7 per share. Sept. 1 Issued 550 shares of preferred stock for a patent. The asking price of the patent was $32,000. Market price for the preferred stock was $70 and the fair value for the patent was indeterminable. Dec. 1 Issued 7,500 shares of common stock for cash at $7.50 per share. Dec. 31 Net income for the year was $260,000. No dividends were declared. 1. Journalize the transactions and the closing entry for net income
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sheffield Corporation is authorized to issue 23,000 shares of $50 par value, 10%
Preferred Stock (11,500 shares) | $575,000 | |
Paid-in Capital in Excess of Par—Preferred Stock | 67,000 | |
Common Stock (62,000 shares) | 310,000 | |
Paid-in Capital in Excess of Par—Common Stock | 650,000 | |
280,000 |
During 2020, the following transactions occurred.
Feb. | 1 | Issued 2,000 shares of preferred stock for land having a fair value of $129,000. | |
Mar. | 1 | Issued 1,200 shares of preferred stock for cash at $65 per share. | |
July | 1 | Issued 17,000 shares of common stock for cash at $7 per share. | |
Sept. | 1 | Issued 550 shares of preferred stock for a patent. The asking price of the patent was $32,000. Market price for the preferred stock was $70 and the fair value for the patent was indeterminable. | |
Dec. | 1 | Issued 7,500 shares of common stock for cash at $7.50 per share. | |
Dec. | 31 |
Net income for the year was $260,000. No dividends were declared. |
1. Journalize the transactions and the closing entry for net income
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