On June 2, 2020, Aerial Corporation issued 100,000 shares of $0.01 par value common stock for...

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On June 2, 2020, Aerial Corporation issued 100,000 shares of $0.01 par value common stock for $1,000,000. One share of Aerial 5% preferred stock ($5 par) was issued with every 10 shares of common stock. The market price per share for the common stock was $6, and the market price per share for the preferred stock was $50 per share. Required a. Record the journal entry for issuance of common and preferred stock. When determining the proportionate shares, round allocations to the nearest dollar. b. Assume that the market price for the common stock was $8 but the market price for the preferred stock was not easily determinable because the shares are not traded publicly. Also, Aerial incurred stock issue costs of $7,000. Record the journal entry for the issuance of common and preferred stock. Allocate stock issue costs proportionately to the common and preferred stock accounts. c. On June 30, 2020, Aerial declares a cash dividend of $15,000. What is the allocation between common and preferred shareholders? Record the journal entry for the dividend declaration. d. On December 31, 2020, Aerial purchases and immediately retires 5,000 shares of common stock at $8 per share. Record the journal entry for the purchase and retirement of the 5,000 shares. Assume the stock issu- ance was recorded as in part a. On June 2, 2020, Aerial Corporation issued 100,000 shares of $0.01 par value common stock for $1,000,000. One share of Aerial 5% preferred stock ($5 par) was issued with every 10 shares of common stock. The market price per share for the common stock was $6, and the market price per share for the preferred stock was $50 per share. Required a. Record the journal entry for issuance of common and preferred stock. When determining the proportionate shares, round allocations to the nearest dollar. b. Assume that the market price for the common stock was $8 but the market price for the preferred stock was not easily determinable because the shares are not traded publicly. Also, Aerial incurred stock issue costs of $7,000. Record the journal entry for the issuance of common and preferred stock. Allocate stock issue costs proportionately to the common and preferred stock accounts. c. On June 30, 2020, Aerial declares a cash dividend of $15,000. What is the allocation between common and preferred shareholders? Record the journal entry for the dividend declaration. d. On December 31, 2020, Aerial purchases and immediately retires 5,000 shares of common stock at $8 per share. Record the journal entry for the purchase and retirement of the 5,000 shares. Assume the stock issu- ance was recorded as in part a.

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Answer a Record the journal entry for issuance of common and preferred stock When determining the pr... View the full answer