Question 1: At December 31, Ortiz Corporation reports net income of $409,900. Prepare the entry to close net income.
Question 2: On May 10, Jack Corporation issues 2,200 shares of $15 par value common stock for cash at $20 per share. Journalize the issuance of the stock.
Question 3: Garb Inc. issues 4,300 shares of $110 par value preferred stock for cash at $135 per share. Journalize the issuance of the preferred stock.
Question 4: During its first year of operations, Foyle Corporation had the following transactions pertaining to its common stock.
Jan. 10 Issued 66,500 shares for cash at $5 per share.
July 1 Issued 43,500 shares for cash at $10 per share.
Journalize the transactions, assuming that the common stock has a par value of $5 per share.
Journalize the transactions, assuming that the common stock is no-par with a stated value of $1 per share.
Question 5: Quay Co. had the following transactions during the current period.
Mar. 2 Issued 4,400 shares of $7 par value common stock to attorneys in payment of a bill for $36,200 for services performed in helping the company to incorporate.
June 12 Issued 64,300 shares of $7 par value common stock for cash of $528,100.
July 11 Issued 2,500 shares of $100 par value preferred stock for cash at $140 per share.
Nov. 28 Purchased 1,850 shares of treasury stock for $80,000.
Journalize the transactions.
Question 6: DeLong Corporation was organized on January 1, 2017. It is authorized to issue 11,000 shares of 8%, $100 par value preferred stock, and 524,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year.
Jan. 10 Issued 83,000 shares of common stock for cash at $4 per share.
Mar. 1 Issued 4,600 shares of preferred stock for cash at $110 per share.
Apr. 1 Issued 23,000 shares of common stock for land. The asking price of the land was $89,500. The fair value of the land was $86,000.
May 1 Issued 81,000 shares of common stock for cash at $5.00 per share.
Aug. 1 Issued 10,500 shares of common stock to attorneys in payment of their bill of $42,000 for services performed in helping the company organize.
Sept. 1 Issued 10,500 shares of common stock for cash at $5 per share.
Nov. 1 Issued 3,000 shares of preferred stock for cash at $112 per share.
Journalize the transactions.
Post to the stockholders' equity accounts.
Prepare the paid-in capital section of stockholders' equity at December 31, 2017.
Question 7: Fechter Corporation had the following stockholders' equity accounts on January 1, 2017: Common Stock ($5 par) $503,000, Paid-in Capital in Excess of Par-Common Stock $192,390, and Retained Earnings $101,490. In 2017, the company had the following treasury stock transactions.
Mar. 1 Purchased 6,060 shares at $9 per share.
June 1 Sold 1,330 shares at $12 per share.
Sept. 1 Sold 1,560 shares at $10 per share.
Dec. 1 Sold 1,150 shares at $7 per share.
Fechter Corporation uses the cost method of accounting for treasury stock. In 2017, the company reported net income of $28,240.
Journalize the treasury stock transactions, and prepare the closing entry at December 31, 2017, for net income.
Open accounts for Paid-in Capital from Treasury Stock, Treasury Stock, and Retained Earnings. Post to these accounts using J10 as the posting reference.
Prepare the stockholders' equity section for Fechter Corporation at December 31, 2017.
Question 8: The stockholders' equity accounts of Castle Corporation on January 1, 2017, were as follows.
Preferred Stock (8%, $50 par, 10,000 shares authorized) - $ 425,000
Common Stock ($1 stated value, 2,050,000 shares authorized) - 1,450,000
Paid-in Capital in Excess of Par-Preferred Stock - 100,000
Paid-in Capital in Excess of Stated Value-Common Stock - 1,500,000
Retained Earnings - 1,800,000
Treasury Stock (11,000 common shares) - 55,000
During 2017, the corporation had the following transactions and events pertaining to its stockholders' equity.
Feb. 1 Issued 26,000 shares of common stock for $120,000.
Apr. 14 Sold 5,600 shares of treasury stock-common for $33,400.
Sept. 3 Issued 5,000 shares of common stock for a patent valued at $34,400.
Nov. 10 Purchased 1,100 shares of common stock for the treasury at a cost of $6,200.
Dec. 31 Determined that net income for the year was $450,000.
No dividends were declared during the year.
Journalize the transactions and the closing entry for net income.
Enter the beginning balances in the accounts, and post the journal entries to the stockholders' equity accounts.
Prepare a stockholders' equity section at December 31, 2017.
Question 9: Irwin Corporation has been authorized to issue 20,500 shares of $100 par value, 10%, preferred stock and 1,042,500 shares of no-par common stock. The corporation assigned a $2.50 stated value to the common stock. At December 31, 2017, the ledger contained the following balances pertaining to stockholders' equity.
Preferred Stock - $110,000
Paid-in Capital in Excess of Par-Preferred Stock - 31,500
Common Stock - 1,042,500
Paid-in Capital in Excess of Stated Value-Common Stock - 2,293,500
Treasury Stock (1,100 common shares) - 13,200
Paid-in Capital from Treasury Stock - 1,650
Retained Earnings - 83,500
The preferred stock was issued for land having a fair value of $141,500. All common stock issued was for cash. In November, 1,650 shares of common stock were purchased for the treasury at a per share cost of $12. In December, 550 shares of treasury stock were sold for $15 per share. No dividends were declared in 2017.
Prepare the journal entries for the: (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
(1) Issuance of preferred stock for land.
(2) Issuance of common stock for cash.
(3) Purchase of common treasury stock for cash.
(4) Sale of treasury stock for cash.
Prepare the stockholders' equity section at December 31, 2017.