Pringle Corporation has been authorized to issue 20,000 shares of $100 par value, 7%, noncumulative preferred stock and 1,000,000 shares of no-par common stock.
The corporation assigned a $5 stated value to the common stock. At December 31, 2014, the ledger contained the following balances pertaining to stockholders' equity.
| Preferred Stock |
|
$150,000 |
| Paid-in Capital in Excess of Par Value-Preferred Stock |
|
20,000 |
| Common Stock |
|
2,000,000 |
| Paid-in Capital in Excess of Stated Value-Common Stock |
|
1,520,000 |
| Treasury Stock- (4,000 common shares) |
|
36,000 |
| Retained Earnings |
|
82,000 |
The preferred stock was issued for $170,000 cash. All common stock issued was for cash. In November 4,000 shares of common stock were purchased for the treasury at a per share cost of $9. No dividends were declared in 2014.
A)Prepare the journal entries for the following. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
| (1) |
|
Issuance of preferred stock for cash. |
| (2) |
|
Issuance of common stock for cash. |
| (3) |
|
Purchase of common treasury stock for cash.
|
B)Prepare the stockholders' equity section of the balance sheet at December 31, 2014.