Using the Column Headings Provided Below, Show the Effect, If

question 12

Essay

Using the column headings provided below, show the effect, if any, of the transaction on each financial statement category by indicating whether it is an addition (+) or subtraction (-) and by showing the amount in the appropriate column. For the treasury stock column, show the effects, if any, of the transaction on total stockholders' equity. Do not show items that affect net income in the retained earnings column. You should assume that the transactions occurred in the chronological sequence as indicated.(1.) Issued 2,400 shares of $60 par value preferred stock in exchange for land and an existing building that had appraised values of $70,000 and $100,000, respectively.(2.) Issued 15,000 shares of $10 par value common stock for $24 per share.(3.) Purchased 2,000 shares of common stock for the treasury at $25 per share.(4.) Sold 1,200 shares of the treasury stock purchased in transaction #3 for $30 per share.(5.) Declared a cash dividend of $1.40 per share on the common stock outstanding, to be paid early next year.(6.) Split the common stock 2-for-1.

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Definitions:

Subject Matter

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