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McNichols Corp. reports the following transactions relating to its stock accounts.

Jan. 15	Issued 25,000 shares of $5 par value common stock at $17 cash per share.
Jan. 20	Issued 6,000 shares of $50 par value, 8% preferred stock at $78 cash per share.
Mar. 31	Purchased 3,000 shares of its own common stock at $20 cash per share.
June 25	Sold 2,000 shares of the treasury stock at $26 cash per share.
July 15	Sold the remaining 1,000 shares of treasury stock at $19 cash per share.

Required

a. Prepare the journal entries for these transactions.

General Journal
Date	Description	Debit	Credit
1/15	Answer CashPreferred stockCommon stockAdditional paid-in capitalTreasury stock	Answer	Answer
	Common Stock	Answer	Answer
	Answer Preferred stockTreasury stockCashCommon stockAdditional paid-in capital	Answer	Answer
1/20	Answer CashAdditional paid-in capitalPreferred stockCommon stockTreasury stock	Answer	Answer
	Preferred stock	Answer	Answer
	Answer Treasury stockAdditional paid-in capitalCashPreferred stockCommon stock	Answer	Answer
3/31	Answer CashCommon stockAdditional paid-in capitalPreferred stockTreasury stock	Answer	Answer
	Answer CashCommon stockPreferred stockTreasury stockAdditional paid-in capital	Answer	Answer
6/25	Answer Preferred stockTreasury stockAdditional paid-in capitalCommon stockCash	Answer	Answer
	Additional paid-in capital	Answer	Answer
	Answer Additional paid-in capitalTreasury stockCommon stockPreferred stockCash	Answer	Answer
7/15	Cash	Answer	Answer
	Answer Treasury stockCashAdditional paid-in capitalCommon stockPreferred stock	Answer	Answer
	Answer Treasury stockPreferred stockAdditional paid-in capitalCommon stockCash	Answer	Answer

b. Post the journal entries from a to the related T-accounts.

Cash (A)
1/15	Answer	Answer
1/20	Answer	Answer
3/31	Answer	Answer
6/25	Answer	Answer
7/15	Answer	Answer

Preferred Stock (SE)
1/15	Answer	Answer
1/20	Answer	Answer
3/31	Answer	Answer
6/25	Answer	Answer
7/15	Answer	Answer

Common Stock (SE)
1/15	Answer	Answer
1/20	Answer	Answer
3/31	Answer	Answer
6/25	Answer	Answer
7/15	Answer	Answer

Treasury Stock (XSE)
1/15	Answer	Answer
1/20	Answer	Answer
3/31	Answer	Answer
6/25	Answer	Answer
7/15	Answer	Answer

Additional Paid-in Capital (SE)
1/15	Answer	Answer
1/20	Answer	Answer
3/31	Answer	Answer
6/25	Answer	Answer
7/15	Answer	Answer

c. Using the financial statement effects template, illustrate the effects of these transactions.

HINT: For Contributed Capital, enter the par value of stock in the first answer box and additional paid-in capital in the second box.

Balance Sheet Transaction Cash Asset + Noncash Assets = Liabilities + Contrib. Capital + Earned Capital - Contra-Equity 1/15 $ Answer + $ Answer = $ Answer + $ Answer + $ Answer - $ Answer Answer 1/20 Answer + Answer = Answer + Answer + Answer - Answer Answer 3/31 Answer + Answer = Answer + Answer + Answer - Answer 6/25 Answer + Answer = Answer + Answer + Answer - Answer 7/15 Answer + Answer = Answer + Answer + Answer - Answer

Income Statement Revenues - Expenses = Net Income $ Answer - $ Answer = $ Answer Answer - Answer = Answer Answer - Answer = Answer Answer - Answer = Answer Answer - Answer = Answer

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