McDougall Corporation is authorized to issue 500,000 shares of $ 40 par value, 10 percent cumulative preferred stock and 2,000,000 shares of $ 0.01 par value common stock. The following transactions summarize the events affecting its capital stock accounts during its first year of operations:
1. The company issued 800,000 shares of common stock for cash of $ 20 per share.
2. 100,000 shares of preferred stock were sold for cash of $ 44 per share.
3. McDougall repurchased and held as treasury stock 10,000 shares of its own common stock at $ 19 per share.
4. 2,000 shares of the treasury stock were reissued at $ 23 per share.
A. Make the entries to record these events.
B. Prepare the shareholders’ equity section of McDougall’s balance sheet assuming Retained Earnings has a credit balance of $ 276,000.

  • CreatedMarch 25, 2015
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