Question

Tyler Corporation was organized in 2014. It’s corporate charter authorized the issuance of 50,000 shares of common stock, par value $5 per share, and 10,000 shares of 8% preferred stock, per value $25 per share.

Prepare journal entries for each of the following transactions:

January 1 Sold and issued 45,000 shares of common stock for cash at $ 25 per share

February 1 Sold and issued 5,000 shares of preferred stock for cash of $75 per share.

June 1 Purchased 7,500 shares of common stock in the open market at $24 per share.

August 1 Sold 1,000 shares of the treasury stock at $26 per share.

October 1 Sold another 1,500 shares of the treasury stock at $23 per share.

December 1 Declared dividends totaling $100,000.

Allocations of the dividend to preferred and common stockholders.

December 31 Paid the dividends that were declared.

Answer 1

Answer& Explanation:

cash 1,125,000 (45,000 x 25)

common stock 225,000 (45,000 x 5)

additional paid-in 900,000 (1,125,000 - 225,000)

cash 375,000 ( 5,000 x 75)

common stock 25,000 (5,000 x 5)

additional paid in 50,000 ( 75,000 - 25,000)

Treasury Stock 180,000 ( 7,500 x 24)

Cash 180,000

Cash 26,000

Treasury Stock 24,000 ( 1,000 x 24)

Asdditional paid in TS 2,000 ( 26,000 - 24,000)

Cash 34,500 ( 1,500 x 23)

Additional Paid-in TS 1,500

Treasury Stock 36,000 ( 1,500 x 24)

Dividends 100,000

Dividneds payable 100,000

Dividends payable 100,000

cash 100,000