Chapter 13, Problem 5P

Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2016, were as follows: a. Issued 15,000 shares of 0 par common stock at 0, receiving cash. b. Issued 4,000 shares of 80 par preferred 5% stock at 100, receiving cash. c. Issued 500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. d. Declared a quarterly dividend of 0.50 per share on common stock and 1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 7,500 shares of Solstice Corp. at 40 per share, plus a 150 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 8,000 shares of treasury common stock at 33 per share. h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for 24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. i. Declared a 1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. j. Paid the cash dividends to the preferred stockholders. k. Received 27,500 dividend from Pinkberry Co. investment in (h). l. Purchased 90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of 375. The bonds are classified as a held- to-maturitv long-term investment. m. Sold, at 38 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of 0.60 per share from the Solstice Corp. investment in (f). o. Sold 1,000 shares of Solstice Corp. at 545, including commission. p. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method, q. Accrued interest for three months on the Dream Inc. bonds purchased in (1). r. Pinkberry Co. recorded total earnings of 240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. s. The fair value for Solstice Corp. stock was 39.02 per share on December 31, 2016. The investment is adjusted to fair value, using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Instructions Journalize the selected transactions. After all of the transactions for the year ended December 31, 2016, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc. a. Prepare a multiple-step income statement for the year ended December 31, 2016, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were 100,000. (Round earnings per share to the nearest cent.) b. Prepare a retained earnings statement for the year ended December 31, 2016. c. Prepare a balance sheet in report form as of December 31, 2016. Income statement data: Advertising expense 150,000 Cost of merchandise sold 3,700,000 Delivery expense 30,000 Depreciation expense -office buildings and equipment 30,000 Depreciation expensestore buildings and equipment 100,000 Dividend revenue 4,500 Gain on sale of investment 4,980 Income from Pinkberry Co. investment 76,800 Income tax expense 140,500 Interest expense 21,000 Interest revenue 2,720 Miscellaneous administrative expense 7.500 Miscellaneous selling expense 14,000 Office rent expense 50,000 Office salaries expense 170,000 Office supplies expense 10,000 Sales 5,254,000 Sales commissions 185,000 Sales salaries expense 385,000 Store supplies expense 21,000 Retained earnings and balance sheet data: Accounts payable 194,300 Accounts receivable 545,000 Accumulated depreciationoffice buildings and equipment 1,580,000 Accumulated depreciationstore buildings and equipment 4,126,000 Allowance for doubtful accounts 8,450 Available for sale investments (at cost) 260,130 Bonds payable. 5%. due 2024 500,000 Cash 246,000 Common stock, 20 par (400,000 shares authorized; 100,000 shares issued. 94,600 outstanding) 2,000,000 Dividends: Cash dividends for common stock 155,120 Cash dividends for preferred stock 100,000 Goodwill 500,000 Income tax payable 44,000 Interest receivable 1,125 Investment in Pinkberry Co. stock (equity method) 1,009,300 Investment in Dream Inc. bonds (long term) 90,000 Merchandise inventory [December 31, 2016). at lower of cost (FIFO) or market 778,000 Office buildings and equipment 4.320,000 Paid-in capital from sale of treasury stock 13,000 Excess of issue price over parcommon stock 886,800 Excess of issue price over parpreferred stock 150,000 Preferred 5% stock. 80 par (30,000 shares authorized; 20,000 shares issued] 1,600,000 Premium on bonds payable 19,000 Prepaid expenses 27,400 Retained earnings, January 1, 2016 9,319,725 Store buildings and equipment 12,560,000 Treasury stock (5,400 shares of common stock at cost of 33 per share) 178,200 Unrealized gain (loss) on available for sale investments (6,500) Valuation allowance for available for sale investments (6,500)

Kent Corporation was organized on January 1, 2014. On that date, it issued 200,000 shares of 10 par value common stock at 15 per share (400,000 shares were authorized). During the period January 1, 2014, through December 31, 2019, Kent reported net income of 750,000 and paid cash dividends of 380,000. On January 5, 2019, Kent purchased 12,000 shares of its common stock at 12 per share. On December 28, 2019, 8,000 treasury shares were sold at 8 per share. Kent used the cost method of accounting for treasury shares. What is Kents total shareholders equity as of December 31, 2019? a. 3,290,000 b. 3,306,000 c. 3,338,000 d. 3,370,000

​Cheap Discount Furniture, Inc. completed the following treasury stock transactions in 2024​: More info Dec. 1 Purchased 1,700 shares of the company's $1 par value common stock as treasury stock, paying cash of $6 per share. Dec. 15 Sold 300 shares of the treasury stock for cash of $9 per share. Dec. 20 Sold 1,300 shares of the treasury stock for cash of $1 per share. (Assume the balance in Paid-In Capital from Treasury Stock Transactions on December 20 is $2,100.)   Requirements 1. Journalize these transactions. Explanations are not required. 2. How will Cheap Discount ​Furniture, Inc. report treasury stock on its balance sheet as of December ​31, 2024​? Requirement 1. Journalize these transactions. ​(Record debits​ first, then credits. Exclude explanations from any journal​ entries.)   Dec. ​1: Purchased 1,700 shares of the​ company's $1 par value common stock as treasury​ stock, paying cash of $6 per share.   Date…

In 2016, Poe's Products completed the treasury stock transactions described below. January 2: Reacquired 10 million shares at $16 per share. February 15: Sold 3 million shares at $20 per share. September 20: Sold 3 million treasury shares at $15 per share. Poe had issued 50 million shares of its $1 par common stock for $18 several years ago.   Required: Record the above transactions, assuming that Poe's Products uses the cost method.

In 2018, Western Transport Company entered into the treasury stock transactions described below. In 2016, Western Transport had issued 140 million shares of its $1 par common stock at $17 per share.Required:Prepare the appropriate journal entry for each of the following transactions:1. On January 23, 2018, Western Transport reacquired 10 million shares at $20 per share.2. On September 3, 2018, Western Transport sold 1 million treasury shares at $21 per share.3. On November 4, 2018, Western Transport sold 1 million treasury shares at $18 per share.

BFAR Company has the following transactions: Acquired 8,000 shares of its own outstanding shares at P20 per share on February 5, 2022. Sold 4,000 of these shares at P27 per share on August 9, 2022. . On November 1, 2022, sold 2,000 shares from its treasury for P18. ● The cost method is used to record treasury shares transactions. The par value of the shares is P15. Compute the cost of remaining treasury shares.

On January 1, 2017, Browning Corporation had 75,000 shares of $1 par value common stock issued and outstanding. During the year, the following transactions occurred: Mar. 1   Issued 90,000 shares of common stock for $675,000. June 1   Declared a cash dividend of $2.00 per share to stockholders of record on June 15. June 30   Paid the $2.00 cash dividend. Dec. 1   Purchased 5,000 shares of common stock for the treasury for $18 per share. Dec. 15   Declared a cash dividend on outstanding shares of $2.50 per share to stockholders of record on December 31. Net income for 2017 amounted to $951,000.Prepare journal entries to record the above transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit

On August 1, 2014, Amherst Company reacquired 4,000 shares of its $15 par value common stock for $18 per share.  Amherst uses the cost method to account for treasury stock.  What journal entry should Amhurst make to record the acquisition of treasury stock? On August 1, 2014, Amherst Company reacquired 4,000 shares of its $15 par value common stock for $18 per share.  Amherst uses the cost method to account for treasury stock.  What journal entry should Amhurst make to record the acquisition of treasury stock? A debit to Treasury Stock for $60,000 and a debit to Retained Earnings for $12,000.  A credit to Cash for $72,000 A debit to Treasury stock for $60,000 and a debit to APIC for $12,000.  A credit to Cash for $72,000 A debit to Retained Earnings for $72,000 and a redit to cash for $72,000 debit to Treasury stock for $72,000 and a credit to cash for $72,000

Kenneth Company was organized on January 1, 2015 at which date it issued 100,000 common stock of P10 par value at P15 per share. During the period January 1, 2015 through December 31, 2015, Kenneth reported net income of P450,000 and paid cash dividend of P230,000. On January 10, 2015, Kenneth purchased 6,000 treasury shares at P12 per share. On December 31, 2015, Kenneth sold 4,000 shares at P8 per share and retired the remaining treasury shares. Kenneth uses the cost method of accounting for treasury shares. What is the total stockholders’ equity at December 31, 2015?   A. 1,720,000 B. 1,704,000 C. 1,688,000 D. 1,680,000