Question

On January 1, Guillen Corporation had 91,500 shares of no-par common stock issued and outstanding. The stock has a stated value of $4 per share. During the year, the following occurred. Apr. 1 Issued 20,000 additional shares of common stock for $16 per share. June 15 Declared a cash dividend of $1 per share to stockholders of record on June 30. July 10 Paid the $1 cash dividend. Dec. 1 Issued 1,000 additional shares of common stock for $20 per share. 15 Declared a cash dividend on outstanding shares of $4.10 per share to stockholders of record on December 31.

Prepare the entries to record these transactions. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Answer 1

Apr. 1 Issued 20,000 additional shares of common stock for $16 per share.

Dr Cash 320,000 (= 20,000 x $16)

Cr Common stock 320,000

June 15 Declared a cash dividend of $1 per share to stockholders of record on June 30.

Dr Retained earnings 42,875 (= 42,875 x $1)

Cr Dividends payable 42,875

July 10 Paid the $1 cash dividend.

Dr Dividends payable 42,875

Cr Cash 42,875

Dec. 1 Issued 1,000 additional shares of common stock for $20 per share.

Dr Cash 20,000 (= 1,000 x $20)

Cr Common stock 20,000

Dec. 15 Declared a cash dividend on outstanding shares of $4.10 per share to stockholders of record on December 31.

Dr Retained earnings 179,887.50 (= 43,875 stocks x $4.10)

Cr Dividends payable 179,887.50