121_09A - Question 1 Eagle corporation filed a corporate...

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Chapter 9 – Page 1 of 12 Question 1 Eagle corporation filed a corporate charter authorizing 100,000 shares of common stock with a par value of $0.50 per share. Record the following journal entries for 2011. Account names Debit Credit A Cash 75,000 Common stock 2,500 Paid-in-capital in excess of par 72,500 Issued 5,000 shares of common stock at $15 per share B Cash 136,000 Common stock 4,000 Paid-in-capital in excess of par 132,000 Issued 8,000 shares of common stock at $17 per share Assume retained earnings were $80,000. Prepare the stockholders’ equity section of the balance sheet. Stockholders’ equity Common stock, $0.50 par value, 100,000 shares authorized, 13,000 shares issued 6,500 Paid-in capital in excess of par 204,500 Total paid-in capital 211,000 Retained earnings 80,000 Total stockholders equity 291,000 What did you learn?
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Chapter 9 – Page 2 of 12 Question 2 Review the stockholders’ equity section of Costco and complete the following tables. Par value common stock $0.005 Shares authorized 1,800,000,000 Shares issued, end of current year 451,754,000 Shares issued, end of previous year 447,297,000 Shares issued during year 4,457,000 Current Previous Change Common stock 2,259 2,236 23 Additional paid-in capital 1,125,543 1,028,414 97,129 Total paid-in capital 1,127,802 1,030,650 97,152 Retained earnings 3,928,748 3,326,659 602,089 Assume the change in par value of stock issued and additional paid- in capital was caused by issuing new stock. Record the journal entry. Account names Debit Credit Cash 97,152 Common stock 23 Additional paid-in capital 97,129 Assume there were no dividends for the year. What was the amount of net income for the year? 602,089 For the following two calculations express shares in thousands. Calculate the average issue price of stock issued during the year. Cash received 97,152 Shares issued = 4,457 = 21.80 Calculate the average issue price of all stock issued. Cash received 1,127,802 Shares issued = 451,754 = 2.50 What did you learn?
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Chapter 9 – Page 3 of 12 Question 3 Raven corporation filed a corporate charter authorizing 50,000 shares of 5% preferred stock with a par value of $50 and 250,000 shares of common stock with a par value of $0.75 per share. Record the following journal entries for 2011. Account names Debit Credit A Cash 520,000 Preferred stock 500,000 PIC x/Par Preferred stock 20,000 Issued 10,000 shares of preferred stock at $52 per share B Cash 420,000 Common stock 15,000 PIC x/Par Common stock 405,000 Issued 20,000 shares of common stock at $21 per share C Cash 100,000 Common stock 3,750 PIC x/Par Common stock 96,250 Issued 5,000 shares of common stock for land, FMV $100,000 Assume retained earnings were $2,000,000. Prepare the stockholders’ equity section of the balance sheet.
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