Problem 13-3A The stockholders\' equity accounts of Castle Corporation on Januar
ID: 2342631 • Letter: P
Question
Problem 13-3A The stockholders' equity accounts of Castle Corporation on January 1, 2017, were as follows. Preferred Stock (8%, $50 par, 10,500 shares authorized) Common Stock ($1 stated value, 1,900,000 shares authorized) Paid-in Capital in Excess of Par-Preferred Stock Paid-in Capital in Excess of Stated Value-Common Stock Retained Earnings Treasury Stock (11,000 common shares) $375,000 ,250,000 140,000 1,450,000 1,850,000 55,000 During 2017, the corporation had the following transactions and events pertaining to its stockholders' equity Feb. 1 Issued 24,500 shares of common stock for $125,000. Apr. 14 Sold 5,600 shares of treasury stock-common for $32,200. Sept. 3 Issued 4,700 shares of common stock for a patent valued at $35,000. Nov. 10 Purchased 1,100 shares of common stock for the treasury at a cost of $6,100. Dec. 31 Determined that net income for the year was $420,000 nd the closing entry for net income. (Record journal entries in the order presented in the problem. Credit account titles are y indented when amount is entered. Do not indent manually.)Explanation / Answer
Journal entries Posting of Journal entries Date Account Titles and Explanation Debit Credit Preferred stock Feb.1,2017 Cash $125,000.00 Date Explanation ref Debit Credit Balance Common stock $24,500.00 Jan.1,2017 Balance $375,000.00 Paid in Capital in Excess of Stated Value - Common stock $100,500.00 (to record issue of 24500 shares of common stock) Common stock Date Explanation ref Debit Credit Balance Apr.14,2017 Cash $32,200.00 Jan.1,2017 Balance $1,250,000.00 Treasury Stock $28,000.00 Feb.1,2017 J5 $24,500.00 $1,274,500.00 Paid in Capital from Treasury Stock $4,200.00 Sep.3,2017 J5 $4,700.00 $1,279,200.00 (to record sale of 5600 shares of Treasury stock) Paid n Capital In Excess of Par - Preferred Stock Sept.3,2017 Patent $35,000.00 Date Explanation ref Debit Credit Balance Common stock $4,700.00 Jan.1,2017 Balance $140,000.00 Paid in Capital in Excess of Stated Value - Common stock $30,300.00 (to record issue of 4700 shares of common stock for patent) Paid in Capital in Excess of Stated Value - Common stock Date Explanation ref Debit Credit Balance Nov.10,2017 Treasury Stock $6,100.00 Jan.1,2017 Balance $1,450,000.00 Cash $6,100.00 Feb.1,2017 J5 $100,500.00 $1,550,500.00 (to record purchase of 1100 shares of common stock @ $6100) Sep.3,2017 J5 $30,300.00 $1,580,800.00 Dec.31,2017 Income Summary $420,000.00 Paid in Capital from Treasury Stock Retained Earnings $420,000.00 Date Explanation ref Debit Credit Balance (to record transfer of net income to retained earnings) Apr.14,2017 J5 $4,200.00 $4,200.00 Retained Earnings Date Explanation ref Debit Credit Balance CASTEL CORPORATION Jan.1,2017 Balance $1,850,000.00 Balance Sheet (Partial) Dec.31,2017 J5 $420,000.00 $2,270,000.00 as on Dec.31,2017 Stockholders Equity Treasury Stock Paid in Capital Date Explanation ref Debit Credit Balance Preferred stock (8% $50 Par , 10500 shares authorised) $375,000.00 Jan.1,2017 Balance $55,000.00 Common stock ($1 stated value,1900000 shares authorised) $1,279,200.00 Apr.14,2017 J5 $28,000.00 $27,000.00 Paid in Capital in Excess of Par - Preferred stock $140,000.00 Nov.10,2017 J5 $6,100.00 $33,100.00 Paid in Capital in Excess of Stated Value - Common stock $1,580,800.00 Paid in Capital from Treasury Stock $4,200.00 Total Contributed Capital $3,379,200.00 Retained Earnings $2,270,000.00 Treasury Stock (6500 common shares) -$33,100.00 Total Stockholders Equity $5,616,100.00