CHECK FIGURES b. Preferred Stock, 2016: $50,000 c. Common Shares Outstanding, 20
ID: 2454149 • Letter: C
Question
CHECK FIGURES
b. Preferred Stock, 2016: $50,000
c. Common Shares Outstanding, 2017: 35,100
Sun Corporation received a charter that authorized the issuance of 100,000 shares of $10 par common stock and 50,000 shares of $50 par, 5 percent cumulative preferred stock. Sun Corporation completed the following transactions during its first two years of operation:
2016
2017
Required
A.) Prepare journal entries for these transactions for 2016 and 2017 and post them to T-accounts.
B.) Prepare the balance sheets at December 31, 2016 and 2017.
C.) What is the number of common shares outstanding at the end of 2016? At the end of 2017? How many common shares had been issued at the end of 2016? At the end of 2017? Explain any differences between issued and outstanding common shares for 2016 and for 2017.
Explanation / Answer
T Account
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Common stock out standing at the end of 2016 are 36000 Shares and et the end of 2017 are 35100.
How many common shares had been issued at the end of 2016? At the end of 2017?
total 64000 common stock can be issued at the end of 2016 and 64900 at the end of 2017.
Balance sheet at the end of year 2016...
T Account
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Debit Credit Jan 5,2016 Cash $ 90,000 Common Stock ($10 par value) $60,000 Additional paid-in capital $30,000 (Issued/sold 6000 share of common stock) jan 12,2106 Cash 55000 5% Perferred Stock ( $ 50 Par value) 50000 Additional paid-in capital 5000 (issued/Sold 1000 Share of Perferred Stock ) Aprl 5, 2016 Cash 630000 Common Stock ($10 par value) 300000 Additional paid-in capital 330000 Sold 30000 share of common Stock Dec 31,2016 Cash 150000 Sales/service Ravenues 150000 (Revenue recognised) Dec 31,2016 operating Expenses 88000 Cash 88000 (Operatng expenses Recogniesed) Dec 31,2016 Divident Declare 125000 Divident payable- Perferred Stock 125000 (Devident declared on perferred stock) Dec 31,2016 Revenue 150000 Retaining Earning 63000 operating Expenses 88000 Divident Declare 125000 (Being Account closed) Feb15,2017 Divident payable- Perferred Stock 125000 cash 125000 (divident Paid on Perfered Stock ) March3,2017 Cash 795000 5% Perferred Stock ( $ 50 Par value) 750000 Additional paid-in capital 45000 (Sold 15000 Share of Perferred Stock ) May 5,2017 Treasary Stcok- Common Stock 9000 Additional paid-in capital 12600 Cash 21600 (purchases 900 Common Stock ) Dec 31,2017 Cash 210000 Sales/service Ravenues 210000 (Revenue recognised) Dec 31,2017 operating Expenses 98000 Cash 98000 (Operatng expenses Recogniesed) Dec 31,2017 Divident Declare 40000 Divident payable- Perferred Stock (Devident declared on 16000 perferred stock) 40000 Dec 31,2017 Divident Declare 17550 Divident payable- Common Stock 17550 (Devident declared on 35100 common Stock) Dec 31,2017 Revenue 210000 operating Expenses 98000 Divident Declare 57550 Retaining Earning 54450 (Being Account closed)