As of December 31, 2011, Nibley Corporation has 300,000 shares of $10 par-value common stock authorized, with

Question:

As of December 31, 2011, Nibley has 300,000 shares of $10 par-value authorized, with 200,000 of these shares issued and outstanding.
Required:
1. Prepare journal entries to record the following 2012 transactions:
Jan. 1 Received authorization for 150,000 shares of 7%, cumulative preferred stock with a of $25.
2 Issued 25,000 shares of the preferred stock at $35 per share.
June 1 Reacquired 30% of the outstanding for $40 per share.
2 Declared a cash of $65,000. The date of record is June 15.
30 Paid the previously declared cash of $65,000.
2. Determine the proper allocation to preferred and common stockholders of a $150,000 cash declared on December 31, 2012. (This is in addition to the June 2 Interpretive Question: Why didn’t the preferred stockholders receive their current-dividend preference of $43,750 in part (2)?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...