On January 1, 2019, the stockholders’ equity section of Newlin Corporation shows common stock ($5 par value) $1,500,000; paid-in capital in excess of par $1,000,000; and retained earnings $1,200,000. During the year, the following treasury stock transactions occurred.

On January 1, 2019, the stockholders’ equity section of Newlin Corporation shows common stock ($5 par value) $1,500,000; paid-in capital in excess of par $1,000,000; and retained earnings $1,200,000. During the year, the following treasury stock transactions occurred.

Mar.    1        Purchased 50,000 shares for cash at $15 per share.
July    1        Sold 10,000 treasury shares for cash at $17 per share.
Sept.      1        Sold 8,000 treasury shares for cash at $14 per share.

Journalize the treasury stock transactions.

Explanation
Mar.    1        Treasury Stock       =     (50,000 × $15)       =     $750,000
                          
July    1        Cash       =     (10,000 × $17)       =     $170,000
            Treasury Stock       =     (10,000 × $15)       =     $150,000
            Paid-in Capital from Treasury Stock       =     (10,000 × $2)       =     $20,000
                          
Sept.      1        Cash       =     (8,000 × $14)       =     $112,000
            Paid-in Capital from Treasury Stock       =     (8,000 × $1)       =     $8,000
            Treasury Stock       =     (8,000 × $15)       =     $120,000
Restate the entry for September 1, assuming the treasury shares were sold at $12 per share.

Explanation
Sept. 1        Cash        =        (8,000 × $12)        =        $96,000
        Treasury Stock        =        (8,000 × $15)        =        $120,000
Thank you!

Hodge Corporation issued 100,000 shares of $20 par value, cumulative, 6% preferred stock on January 1, 2018, for $2,300,000. In December 2020, Hodge declared its first dividend of $500,000.

Hodge Corporation issued 100,000 shares of $20 par value, cumulative, 6% preferred stock on January 1, 2018, for $2,300,000. In December 2020, Hodge declared its first dividend of $500,000.

Prepare Hodge’s journal entry to record the issuance of the preferred stock.



Explanation
Preferred Stock = 100,000 × $20 = $2,000,000

If the preferred stock is not cumulative, how much of the $500,000 would be paid to common stockholders?


Explanation
Total Dividend                $500,000
Less: Preferred Stock Dividend         ($2,000,000 × 6%)        120,000
Common Stock Dividends                $380,000

If the preferred stock is cumulative, how much of the $500,000 would be paid to common stockholders?

Explanation
Total Dividend               
$500,000
Less: Preferred Stock Dividend         [($2,000,000 × 6%) × 3]       
360,000
Common Stock Dividends               
$140,000

Thank you!

During its first year of operations, Foyle Corporation had the following transactions pertaining to its common stock.

During its first year of operations, Foyle Corporation had the following transactions pertaining to its common stock.

Jan.    10        Issued 70,000 shares for cash at $5 per share.
July       1        Issued 40,000 shares for cash at $7 per share.

Journalize the transactions, assuming that the common stock has a par value of $5 per share.



Explanation
Jan. 10        Cash     =     (70,000 × $5)     =     $350,000
                       
July 1        Cash     =     (40,000 × $7)     =     $280,000
        Common Stock     =     (40,000 × $5)     =     $200,000
        Paid-in Capital in Excess of Par-Common Stock     =     (40,000 × $2)     =     $80,000

Journalize the transactions, assuming that the common stock is no-par with a stated value of $1 per share.


Explanation
Jan. 10        Cash     =     (70,000 × $5)     =     $350,000
        Common Stock     =     (70,000 × $1)     =     $70,000
        Paid-in Capital in Excess of Stated Value-Common Stock     =     (70,000 × $4)     =     $280,000
                       
July 1        Cash     =     (40,000 × $7)     =     $280,000
        Common Stock     =     (40,000 × $1)     =     $40,000
        Paid-in Capital in Excess of Stated Value-Common Stock     =     (40,000 × $6)     =     $240,000
Thanks

Season tickets for the Dingos are priced at $320 and include 16 home games. An equal amount of revenue is recognized after each game is played. When the season began, the amount credited to Unearned Ticket Revenue was $1,728,000. By the end of October, $1,188,000 of the Unearned Ticket Revenue had been recognized as revenue.

Season tickets for the Dingos are priced at $320 and include 16 home games. An equal amount of revenue is recognized after each game is played. When the season began, the amount credited to Unearned Ticket Revenue was $1,728,000. By the end of October, $1,188,000 of the Unearned Ticket Revenue had been recognized as revenue.

How many season tickets did the Dingos sell?
Answer
$1,728,000 ÷ $320  = 5,400 season tickets sold.

How many home games had the Dingos played by the end of October?
Answer
$1,728,000 ÷ 16 home games     =     $108,000 revenue recognized per home game.
$1,188,000 ÷ $108,000 (Home games played = Ticket rev. ÷ Rev. per home game)
     =     11 home games already played.
Prepare the entry for the initial recording of the Unearned Ticket Revenue.

Prepare the entry to recognize the revenue after the first home game had been played.
 

Thanks