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    Frances451 Posts: 1, Reputation: 1
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    #1

    Jun 5, 2012, 01:07 PM
    Accounting Questions?
    1. Finney Corporation is authorized to issue 1,000,000 shares of $3 par value common stock. During 2012, its first year of operation, the company has the following stock transactions.

    Jan. 15 Issued 400,000 shares of stock at $8 per share.
    Jan. 30 The company’s attorney accepted 1,500 shares of common stock as payment for legal
    services rendered in helping the company incorporate. The legal services are estimated to have a value of $8,000.
    July 2 Issued 100,000 shares of stock for land. The land had an asking price of $1,000,000. The stock is currently selling on a national exchange at $9 per share.
    Instructions
    Journalize the transactions for Finney Corporation.

    2. Walton Corporation has the following stockholders' equity accounts on January 1, 2012:
    Common Stock, $10 par value $1,500,000
    Paid-in Capital in Excess of Par 200,000
    Retained Earnings 500,000
    Total Stockholders’ Equity $2,200,000

    The company uses the cost method to account for treasury stock transactions. During 2012, the following treasury stock transactions occurred:
    April 1 Purchased 10,000 shares at $16 per share.
    August 1 Sold 2,500 shares at $18 per share.
    October 1 Sold 3,100 shares at $13 per share.
    Instructions
    Journalize the treasury stock transactions for 2012.

    3. Derek Corporation was organized on January 1, 2010. During its first year, the corporation issued 20,000 shares of $5 par value preferred stock and 200,000 shares of $1 par value common stock. At December 31, the company declared the following cash dividends:
    Year Dividend
    2010 5,000
    2011 15,000
    2012 35,000
    Instructions
    (a) Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 8% and cumulative.
    (b) Journalize the declaration of the cash dividend at December 31, 2012.

    4. On January 1, 2012, Alfred Corporation had $2,500,000 of $10 par value common stock outstanding that was issued at par and retained earnings of $1,000,000. The company issued 150,000 shares of common stock at $14 per share on July 1. On December 15, the board of directors declared a 15%
    stock dividend to stockholders of record on December 31, 2012, payable on January 15, 2013. The market value of Alfred Corporation stock was $17 per share on December 15 and $18 per share on December 31. Net income for 2011 was $500,000.
    Instructions
    Journalize the issuance of stock on July 1, the declaration of the stock dividend on December 15, 2012, and the issuance of the stock dividend on January 15, 2013.

    5. Prepare the journal entries for the following two independent situations:
    (a) On January 1, 2012, Renner Corporation issued $200,000, 9%, 5-year bonds for $192,280. The bonds were sold to yield an effective-interest rate of 10%. Prepare the journal entry that Renner Corporation would make on January 1.
    (b) Justice, Inc. redeemed $200,000 of its bonds at 97 on June 30, 2012, and immediately retired them. The carrying value of the bonds on the retirement date was $196,500. The bonds pay semiannual interest and the interest payment due on June 30, 2012 has been made and recorded. Prepare the journal entry to record the retirement of these bonds.

    6. On December 31, 2011, Rhadik, Inc. owned the following securities, held as a short-term investment (trading securities). The securities are not held for influence or control of the investee.
     # of
    Stock Shares Cost
    Carrin Common Stock 3,200 72,600
    BBD Common Stock 6,400 48,600
    Whitemarsh Common Stock 2,700 35,700
    156,900

    On December 31, 2011, the total fair value of the securities was equal to its cost. In 2012, the following transactions occurred:

    July 1 Received $2.10 per share semiannual cash dividend on BBD Co. common stock.
    Aug 1 Received $0.75 per share cash dividend on Carrin Co. common stock.
    Sept 1 Sold 1,600 shares of BBD Co. common stock for cash at $7 per share, less brokerage fees of $400.
    Oct 1 Sold 900 shares of Carrin Co. common stock for cash at $32 per share, less brokerage fees of $600.
    Nov 1 Received $2 per share cash dividend on Whitemarsh Co. common stock.
    Dec 15 Received $0.75 per share cash dividend on Carrin Co. common stock.
    Dec 31 Received $2.10 per share semiannual cash dividend on BBD Co. common stock.

    At year end on December 31, 2012, the market values per share were:
    Carrin Common Stock $28.00
    BBD Common Stock $5.00
    Whitemarsh Common Stock $19.00

    Instructions
    (a) Prepare the journal entries to record the 2012 stock transactions.
    (b) On December 31, 2012, prepare any adjusting entry that might be necessary relative to the portfolio.

    7. Information pertaining to long-term investments in stock in 2012 by Tate Corporation follows: Obtained significant influence over Wynn Company by buying 30% of Wynn's 100,000 outstanding shares of common stock at a total cost of $24 per share on January 1, 2012. On June 15, Wynn Company declared and paid a cash dividend of $1.80 per share. On December 31, Wynn's reported net income was $300,000.

    Instructions
    Prepare journal entries for January 1, June 15, and December 31 for Tate Corporation.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Jun 5, 2012, 03:04 PM
    And your question is?
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #3

    Jun 5, 2012, 03:30 PM
    Instructions
    Prepare journal entries .
    ..

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