Question $21$

$50$ pts

PROBLEM $1.(25$ points$)$

Gryffindor Corporation has $100,000$ shares of $$1$ par common stock outstanding as of the beginning of $2024.$ Prepare the journal entries for the following transactions for $2024.$ Indicate $"$No Entry" if no journal entry is necessary.

May $18$

Issued $20,000$ additional shares of $$1$ par value common stock for $$40$ per share.

May $31$ Repurchased $4,000$ shares of treasury stock for $$45$ per share.

July $1$

Declared a cash dividend of $$1$ per share to all stockholders of record on July $15.$

July $15$

Date of record for the dividend declared on July $1.$ Stockholders of record are entitled to the dividend to be paid out on July $31.$

July $31$ Paid the cash dividend declared on July $1.$

August $10$

Reissued $2,500$ shares of treasury stock purchased on May $31$ for $$46$ per share.

August $20$

Reissued the remaining shares of treasury stock purchased on May $31$ for $$42$ per share.

Equipment with an original cost of $$30,000$ was sold for $$5,000.$ The equipment

August $31$ was originally purchased on July $1,2022.$ The equipment was estimated to have a useful life of $9$ years and a $$3,000$ salvage value. Assume straight$-$line depreciation was used.

Oct. $1$

Wrote off the $$38,000$ account of Newt Scamander and the $$2,000$ account of Luna Lovegood.

PROBLEM $2.(25$ points$)$

The comparative balance sheets of Dumbledore Design Studio, Inc. at December $31,2024$ and $2023$ is presented below.

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