On January 1, Guillen Corporation had 92,000 shares of no-par common stock issue
ID: 2537676 • Letter: O
Question
On January 1, Guillen Corporation had 92,000 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 23,500 additional shares of common stock for $17 per share.
June 15 Declared a cash dividend of $2 per share to stockholders of record on June 30.
July 10 Paid the $2 cash dividend.
Dec. 1 Issued 1,000 additional shares of common stock for $18 per share.
Dec.15 Declared a cash dividend on outstanding shares of $4.80 per share to stockholders of record on December 31.
Explanation / Answer
Answer:
Date
Description
Debit $
Credit $
15-Jun
Retained earning
231000
Dividend Payable
231000
(92000+23500)*2
(to record the declaration of
dividends)
10-Jul
Dividend Payable
231000
Cash
231000
(To record the payment of dividend)
15-Dec
Retained earning
559200
Dividend Payable
559200
(92000+23500+1000)*4.80
(to record the declaration of
dividends)
Date
Description
Debit $
Credit $
15-Jun
Retained earning
231000
Dividend Payable
231000
(92000+23500)*2
(to record the declaration of
dividends)
10-Jul
Dividend Payable
231000
Cash
231000
(To record the payment of dividend)
15-Dec
Retained earning
559200
Dividend Payable
559200
(92000+23500+1000)*4.80
(to record the declaration of
dividends)