A: The charter of the Sanders Corporation authorizes the issuance of 1,500,000 shares of no-par common stock and 500,000 shares of 8 percent, $50 par value, cumulative preferred stock. These events affected shareholders' equity during the first year of operation:
1. 200,000 shares of common stock were sold for $15 per share.
2. 40,000 shares of preferred stock were sold at $52 per share.
3. A building worth a fair market value of $560,000 was acquired for a cash payment of $150,000 and 17,000 shares of commons stock.
4. 30,000 shares of common stock were issued for $690,000 cash.
5. A dividend of $1 per share for common and $4 per share for preferred stock was declared.
Make the journal entries to record the transactions just described.
B: McDougall Corporation is authorized to issue 500,000 shares of $40 par value, 10 percent cumulative preferred stock and 2,000,000 shares of $0.01 par value common stock. The following transactions summarize the events affecting its capital stock accounts during its first year of operations.
1. The company issued 800,000 shares of common stock for cash of $20 per share.
2. 100,000 shares of preferred stock were sold for cash of $44 per share.
3. McDougall repurchased and held as treasury stock 10,000 shares of its own common stock at $19 per share.
4. 2,000 shares of the treasury stock were reissued at $23 per share.
Make the journal entries to record these events.