90.2K

Verified Solution

Link Copied!

The Stockholders Equity section of the balance sheet of Willy Corporation on January 1, 2019, is shown below; selected transactions for the year follow:

Required:

1. Open the stockholders equity accounts in the general ledger and enter the beginning balances. In addition to the accounts listed, open the following accounts: Donated Capital, Treasury StockPreferred, Retained EarningsAppropriated for Treasury Stock
2. Record the transactions in general journal form.
3. Post the transactions to the stockholders equity accounts.
4. Prepare the Stockholders Equity section of the balance sheet.

Analyze: If Willy Corporation had not repurchased preferred stock to place in treasury, what total stockholders equity would be reported on December 31, 2019?

$77,000 7,700 $ 84,700 Stockholders' Equity Preferred Stock (10% cumulative, $10 par value, 200,000 shares authorized) Issued and Outstanding, 7,700 Shares Paid-in Capital in Excess of Par Value Common Stock (no-par value, $50 stated value, 170,000 shares authorized) Issued and Outstanding, 1,700 Shares Paid-in Capital in Excess of Stated Value Total Paid-in Capital Retained Earnings Total Stockholders' Equity 85,000 3,400 88,400 $173,100 127,000 $300,100 4 De DATE TRANSACTIONS Feb. 15 Repurchased 4,100 shares of the outstanding preferred stock for $45,100 in cash. The stock is to be held as treasury stock. State law requires that an amount of retained earnings equal to the cost of treasury stock held must be appropriated. Record the purchase and the appropriation of retained earnings. Mar. Declared a 2-for-1 stock split of common stock. Each shareholder will own twice as many shares as originally owned. Stated value is reduced to $25 per share. Date of record is March 15. Date of issue of new shares is April 1. April 1 Issued new shares called for by split. June 17 Declared semiannual dividend of 5 percent on preferred stock, to be paid on July 12 to holders of record on June 30. July 12 Paid cash dividend on preferred stock. Sept. 25 Purchased 600 shares of outstanding preferred stock at $10 per share to be held as treasury stock. Record appropriated retained earnings equal to cost of the treasury stock. Dec. 15 Declared semiannual cash dividend of 5 percent on preferred stock to be paid on January 12 to holders of record on December 30. 15 Declared cash dividend of $1.20 per share on common stock to be paid on January 12 to holders of record on December 30. 15 Accepted title to a tract of land with an appraised value of $147,000 from the City of Greenville. The tract is to be used as a building site for the corporation's new factory. 31 Had net income after taxes for the year of $67,000. Give the entry to close the Income Summary account. Complete this question by entering your answer in the tabs below. General Journal Ledger Accounts Balance Sheet Analyze Record the transactions in general journal form. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet

Answer & Explanation Solved by verified expert

See Answer