Some of the account balances of Mali Company at December 31, 20x0 are shown below:
6% Preferred Stock ($100 par, $2,000 shares authorized) ... $ 20,000
PCIEP, Preferred ..................$ 3,000
Common Stock ($10 par, 100,000 shares authorized) .... $ 500,000
PCIEP, Common ..................$ 100,000
Retained Earnings ...................$ 304,000
Treasury Stock-Preferred (50 shares at cost) ........$ 5,500
Treasury Stock-Common (1,000 shares at cost) ......$ 16,000
The price of the company's common stock has been increasing steadily onthe market; it was $21 on January 1, 20x1, advanced to $24 by July 1, andto $27 at the end of the year 20x1. The preferred stock was not openlytraded, but was appraised at $120 per share during 20x1.
1) Give the proper journal entries for each of the following occurred in 20x1:
(a) The company declared a property dividend on April 1. Each common stockholder was to receive one share of Washington for every 10 shares outstanding. Mali had 8,000 shares of Washington (2% of total outstanding stock) which was purchased a few weeks ago for $68,400. The market value of Washington stock was $16 per share on April 1. Record appreciation only on the shares distributed.
(b) The company resold the 50 shares of preferred stock held in the treasury for $116 per share.
(c) On July 1, the company declared a 5% stock dividend to the common stockholders.
(d) On October 1, the company incurred a fire loss of $7,000 to its warehouse (ordinary loss).
(e) On October 15, the company declared a cash dividend of $100,000. Assume the preferred stock is non-cumulative.