Instructions Selected transactions completed by ATV Discount Corporation during
ID: 2549924 • Letter: I
Question
Instructions Selected transactions completed by ATV Discount Corporation during the current fiscal year are as follows: Jan. 5. Split the common stock 3 for 1 and reduced the par from $75 to $25 per share. After the split, there were 1,150,500 common shares outstanding. Mar. 0 Purchased 41,400 shares of the corporation's own common stock at $28, recording the stock at cost. Apr. 30 Declared semiannual dividends of $0.80 on 74,100 shares of preferred stock and $0.12 on the common stock to stockholders of record on May 15, payable on June 15. June 15. Paid the cash dividends. Aug. 20. Sold 29,000 shares of treasury stock at $33, receiving cash. Oct. 15 Declared semiannual dividends of $0.80 on the preferred stock and $0.12 on the common stock (before the stock dividend). In addition, a 2% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $36. The dividend date of record is November 15 payable on December 19. Paid the cash dividends and issued the certificates for the common stock dividend. Dec. 19. Journalize the transactions. If no entry is required, simply skip to the next transaction. Refer to the Chart of Accounts for exact wording of account titles.Explanation / Answer
Journal Entry in the books of ATV Discount Corporation Date Account & Explanation Debit Credit 05-Jan No Entry To record Split the common stock 10-Mar Treasury Stock (41400 Share*$28) $1,159,200.00 Cash $1,159,200.00 To Record the stock bpugh at cost 30-Apr Dividend $192,372.00 Dividedend Payable $192,372.00 ( 74100*$0.80 +1109100*0.12) TO Record Dividend Payable 15-Jun Dividend Payable $192,372.00 Cash $192,372.00 To Record Payment of Cash Dividend 20-Aug Cash (29000 Share*$33) $957,000.00 Treasury Stock (29000*$25) $725,000.00 Paid in capital from sale of Treasury $232,000.00 To Record Sale of Treasury Stock 15-Oct Dividend $75,668.64 Dividend Payable $75,668.64 ($0.80*74100+0.12*(1150500-41400+29000)*$0.12 To Record Dividend Payable 15-Oct Stock Dividend (11381*2%*$36) $8,194.32 Stock Dividend distributable (11381*2%*$25) $56,905.00 Paid in exess of Par Value (11381*2%*($36-$25)) $2,503.82 11381Share*2%*($36-$28) To Record Stock dividend 19-Oct Dividend Payable Cash To Record dividend Paid 19-Dec Stock Dividend distributable $56,905.00 Common Stock-Par Value $56,905.00 To Record common stock issued