Expert answer:I need help with an accounting assignment
Answer & Explanation:ACCT 220 Week 8 Homework – Chapter 14.xls
acct_220_week_8_homework____chapter_14.xls
Unformatted Attachment Preview
Name:
B-14.03
Date:
Section:
Prepare journal entries to record each of the following independent stock issue situations.
(a)
Sherri Hui Corporation issued 100,000 shares of $1 par value common stock. The issue
price was $30 per share.
(b) Ariana Corporation issued 50,000 shares of no par common stock for $10 per share.
c.
Laser Golf issued 40,000 shares of $100 par value preferred stock. The issue price was
$102 per share.
(d)
Charleston Industries issued 5,000 shares of $5 par value common stock for land with a
fair value of $75,000.
GENERAL JOURNAL
Date
Accounts
(a)
To record issue of 100,000 shares of $1 par
value common stock at $30 per share
(b)
To record issue of 50,000 shares of no par
value common stock at $10 per share
(c)
To record issue of 40,000 shares of $100
par value preferred stock at $102 per share
(d)
Debit
Credit
Name:
Date:
B-14.03
Section:
To record issue of 5,000 shares of $5 par
value common stock for land with a fair
value of $75,000
B-14.04
Krull Corporation presented the following selected information. The company has a calendar year
end.
Before considering the effects of dividends, if any, Krull’s net income for 20X7 was $2,500,000.
Before considering the effects of dividends, if any, Krull’s net income for 20X8 was $3,000,000.
Krull declared $750,000 of dividends on November 15, 20X7. The date of record was January
15, 20X8. The dividends were paid on February 1, 20X8.
Stockholders’ equity, at January 1, 20X7, was $5,000,000. No transactions impacted
stockholders’ equity throughout 20X7 and 20X8, other than the impact of earnings and dividends
on retained earnings.
(a) Prepare journal entries, if needed, to reflect the dividend declaration, the date of record, and the
date of payment.
(b) How much was net income for 20X7 and 20X8?
(c) How much was total equity at the end of 20X7 and 20X8?
(d) Is total “working capital” reduced on the date of declaration, date of record, and/or date of
payment?
Name:
B-14.04
Date:
Section:
(a)
GENERAL JOURNAL
Date
Declare
Date
Record
Date
Pay
Date
(b)
(c)
(d)
Accounts
Debit
Credit
B-14.06
Kenya Corporation had an equity structure that consisted of $1 par value common stock, $3,500,000;
paid-in capital in excess of par, $17,500,000; and retained earnings, $22,700,000.
Transaction A
Believing that its share price was depressed due to general market conditions, Kenya’s board of
directors authorized the reacquisition of 250,000 shares of common stock. These treasury
shares were purchased at $10 per share.
Transaction B
Subsequent to Transaction A, the stock price increased to $17 per share, and half of the treasury
shares were sold in the open market.
Transaction C
Subsequent to Transaction B, Kenya experienced business difficulties that necessitated it selling
the remaining treasury shares to raise additional cash. The shares were sold for $6 per share.
(a) Assuming that all 3,500,000 shares of Kenya were issued at the same time and at the same price
per share, what was the original issue price? How does this compare to the price paid in
Transaction A, and is it rational for a company to pay more to buy back shares than it originally
received upon the initial issuance?
(b) Prepare an appropriate journal entry to record Transaction A. Kenya records treasury shares at
cost.
(c) Prepare an appropriate journal entry for Transaction B.
(d) Prepare an appropriate journal entry for Transaction C.
(e)
Is there any income statement impact from these transactions? What is the impact on total
stockholders’ equity from each of the three transactions?
Name:
B-14.06
Date:
Section:
(a)
(b)(c)(d)
GENERAL JOURNAL
Date
Accounts
A
To record acquisition of 250,000 treasury
shares at $10 per share
B
To record reissue of 125,000 treasury
shares at $17 per share
C
To record reissue of 125,000 treasury
shares at $6 per share
(e)
Debit
Credit
B-14.07
Magic Blade’s stock has risen rapidly to $50 per share. The increase is due to excitement
about its new knife that uses a light beam to slice fruits and vegetables. This process
enhances the final appearance and quality of salads and fruit trays.
The board of directors is considering strategies to divide the corporate ownership into more
shares of stock, and bring about some reduction in the price per share. They are considering a
stock split, small stock dividend, or large stock dividend. The board is unsure of the accounting
effects of such transactions, and has requested information about how stockholders’ equity
would be impacted.
Prior to the contemplated stock transaction, equity consisted of:
Common stock, $2 par, 2,000,000 shares authorized, 500,000
shares issued and outstanding
$
1,000,000
Paid-in capital in excess of par
2,000,000
Retained earnings
6,000,000
Total stockholders’ equity
$
9,000,000
(a)
Assuming the board were to declare a 2 for 1 split, how would the revised stockholders’
equity appear?
(b)
Assuming the board were to declare a 15% stock dividend, how would the revised
stockholders’ equity appear?
(c)
Assuming the board were to declare a 50% stock dividend, how would the revised
stockholders’ equity appear?
(d)
Prepare journal entries that would be needed (if necessary) to record the proposed
transactions from part (a), (b), and (c).
Name:
Date:
B-14.07(a,b,c)
Section:
(a)
Common stock,
$
–
Paid-in capital in excess of par
–
Retained earnings
–
Total stockholders’ equity
$
–
Common stock,
$
–
(b)
Paid-in capital in excess of par
–
Retained earnings
–
Total stockholders’ equity
$
–
Common stock,
$
–
(c)
Paid-in capital in excess of par
–
Retained earnings
$
Total stockholders’ equity
(d)
–
GENERAL JOURNAL
Accounts
Debit
Credit
Name:
Date:
B-14.07(a,b,c)
Section:
…
Purchase answer to see full
attachment
How it works
- Paste your instructions in the instructions box. You can also attach an instructions file
- Select the writer category, deadline, education level and review the instructions
- Make a payment for the order to be assignment to a writer
- Download the paper after the writer uploads it
Will the writer plagiarize my essay?
You will get a plagiarism-free paper and you can get an originality report upon request.
Is this service safe?
All the personal information is confidential and we have 100% safe payment methods. We also guarantee good grades