During its first year of operations, Cole's Electronics Inc. completed the following transactions relating to shareholders' equity. Jan. 5: Issued 1,000,000 shares of common stock for $25 per share. Feb. 12: Issued 20,000 shares of common stock to accountants for professional services. The articles of incorporation authorize 5,000,000 shares of common stock with a par value of $1 per share and 1,000,000 preferred shares with a par value of $100 per share.

Required:

1. Record the above transactions in general journal form.

2. The shareholders' equity of Tru Corporation includes $600,000 of $1 par common stock and $1,200,000 of 6% cumulative preferred stock. The board of directors of Tru declared cash dividends of $150,000 in 2011 after paying $60,000 cash dividends in each of 2010 and 2009. Required: What is the amount of dividends common shareholders will receive in 2011?

Answer rating: 100% (QA)

1 Date Account Title Debit Credit Jan 5 Cash 25000000 Common stoc... View the full answer