As of January 1, 2019, the equity section of BC Marine Co.s balance sheet contained the following:
Question:
As of January 1, 2019, the equity section of BC Marine Co.’s balance sheet contained the following:
■ On May 1, 2019, the company spent $500,000 to repurchase 100,000 common shares. These shares were cancelled immediately.
■ On July 15, 2019, the company repurchased and cancelled 1,000 preferred shares at $20 per share.
■ On November 1, 2019, the company declared and paid the annual cash dividends on the preferred shares. On the same day, the company issued a 10% stock dividend on common shares. BC Marine’s stock traded at $6 per share after the dividend.
Required:
Assume that BC Marine follows the guidance in ASPE pertaining to accounting for equity transactions. Record the journal entries for the above transactions occurring in 2019.
Step by Step Answer: