Problem 11-2A (Part Level Submission) The stockholders\' equity accounts of Bram
ID: 2528263 • Letter: P
Question
Problem 11-2A (Part Level Submission) The stockholders' equity accounts of Bramble Corp. on January 1, 2017, were as follows. Preferred Stock (696, $100 par noncumulative, 5,000 shares authorized) Common Stock ($4 stated value, 300,000 shares authorized) Paid-in Capital in Excess of Par Value-Preferred Stock Paid-in Capital in Excess of Stated Value-Common Stock Retained Earnings Treasury Stock (5,000 common shares) $300,000 1,000,000 15,000 480,000 707,500 40,000 During 2017, the corporation had the following transactions and events pertaining to its stockholders' equity. Feb. 1 Mar. 20 Oct. 1 Nov. 1 Dec. 1 Dec. 31 Issued 5,000 shares of common stock for $35,000 Purchased 1,000 additional shares of common treasury stock at $9 per share Declared a 6% cash dividend on preferred stock, payable November 1 Paid the dividend declared on October 1 Declared a $0.40 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017. Determined that net income for the year was $281,700. Paid the dividend declared on December 1.Explanation / Answer
Answers
Date
Accounts Titles
Debit
Credit
Working
01-Feb
Cash
$ 35,000.00
[cash received]
Common Stock
$ 20,000.00
[5000 x $4 par]
Paid in capital in excess of Par value - common stock
$ 15,000.00
[35000 - 20000]
(common stock issued)
20-Mar
Treasury Stock
$ 9,000.00
Cash
$ 9,000.00
(shares re acquired)
01-Oct
Dividend
$ 18,000.00
[$300000 x 6%]
Dividend payable
$ 18,000.00
[$300000 x 6%]
(dividend declared)
01-Nov
Dividend payable
$ 18,000.00
Cash
$ 18,000.00
(dividend paid to preferred stock shareholders)
01-Dec
Dividend
$ 99,600.00
[250000 shares + 5000 issued - 6000 treasury shares = 249000 shaares x $0.4]
Dividend payable
$ 99,600.00
(dividend declared)
31-Dec
Income Summary
$ 2,81,700.00
Retained Earnings
$ 2,81,700.00
(incom recorded)
31-Dec
Retained Earnings
$ 1,17,600.00
[18000 + 99600]
Dividends
$ 1,17,600.00
(cash dividend account closed)
31-Dec
Dividend payable
$ 99,600.00
Cash
$ 99,600.00
(dividend paid)
Date
Accounts Titles
Debit
Credit
Working
01-Feb
Cash
$ 35,000.00
[cash received]
Common Stock
$ 20,000.00
[5000 x $4 par]
Paid in capital in excess of Par value - common stock
$ 15,000.00
[35000 - 20000]
(common stock issued)
20-Mar
Treasury Stock
$ 9,000.00
Cash
$ 9,000.00
(shares re acquired)
01-Oct
Dividend
$ 18,000.00
[$300000 x 6%]
Dividend payable
$ 18,000.00
[$300000 x 6%]
(dividend declared)
01-Nov
Dividend payable
$ 18,000.00
Cash
$ 18,000.00
(dividend paid to preferred stock shareholders)
01-Dec
Dividend
$ 99,600.00
[250000 shares + 5000 issued - 6000 treasury shares = 249000 shaares x $0.4]
Dividend payable
$ 99,600.00
(dividend declared)
31-Dec
Income Summary
$ 2,81,700.00
Retained Earnings
$ 2,81,700.00
(incom recorded)
31-Dec
Retained Earnings
$ 1,17,600.00
[18000 + 99600]
Dividends
$ 1,17,600.00
(cash dividend account closed)
31-Dec
Dividend payable
$ 99,600.00
Cash
$ 99,600.00
(dividend paid)