Prepare Journal Entries to Record Each of the Following Year

question 35

Essay

Prepare journal entries to record each of the following Year 1 transactions for Satar Co.
a.Issue 12,000 shares of common stock with a par value of $2 for $5 a share.
b.Issue 30 shares of 8% cumulative preferred stock with a par value of $1,000 for $1,100 a share.
c.Pay dividends of $10,000 with cash.
d.Repurchase 1,000 shares of common stock for $6 a share.
e.Resell 400 shares of the treasury stock for $7 a share.

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Definitions:

Unionization Rate

The percentage of a particular population of workers that belongs to labor unions; alternatively, the percentage of a population of workers that is represented by one union or another in collective bargaining.

Union Members

Individuals who belong to an organization that represents workers in negotiations with employers over wages, benefits, and working conditions.

Shirking

Shirking describes when employees underperform or exert less effort than expected because of insufficient incentives or the absence of effective monitoring.

Perfectly Inelastic

Describes a situation where the quantity demanded or supplied does not change in response to a change in price; the demand or supply curve is vertical.