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 Lovegoo

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 purchasection 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.

Nov. $15$

Declared and distributed a $10\%$ stock dividend on all shares outstanding. The stock price on this date was $$44$ per share.

Dec. $17$

Collected $$2,000$ from Luna Lovegood for the account previously written off on Oct. $1$

Recorded the adjustment for uncollectible accounts, which are estimated to be Dec. $311\%$ of credit sales for the year. Credit sales for $2022$ amounted to $$4,600,000.$ The balance in the allowance for bad debts on January $1,2024$ was $$35,000.$