Tennis Apparel has two classes of stock authorized: $4\%,$ $$10$ par preferred, and $$1$ par value common. The following transactions affect stockholders$$ equity during $2024,$ its first year of operations:

January $2$ Issue $120,000$ shares of common stock for $$56$ per share.

February $14$ Issue $46,000$ shares of preferred stock for $$13$ per share.

May $8$ Purchase $12,000$ shares of its own common stock for $$46$ per share.

May $31$ Resell $6,000$ shares of treasury stock for $$51$ per share.

December $1$ Declare a cash dividend on its common stock of $$0\mathrm{.}70$ per share and a $$18,400(4\%$ of par value$)$ cash dividend on its preferred stock payable to all stockholders of record on December $15.$ The dividend is payable on December $30.($Hint: Dividends are not paid on treasury stock.$)$

December $30$ Pay the cash dividends declared on December $1.$

 

 

Required:

$1.$ Record each of these transactions in journal format. $($If no entry is required for a transaction$/$event$,$ select $"$No Journal Entry Required" in the first account field.$)$

$2.$ Prepare the stockholders$$ equity section of the balance sheet as of December $31,2024.$ Net income for the year was $$476,000.($Amounts to be deducted should be indicated by a minus sign.$)$

Answer rating: 100% (QA)

1 Record each of these transactions in journal format a January 2 Issue 120000 shares of common stoc... View the full answer