Arnold Corporation has been authorized to issue 40,000 shares of $100 par value, 8%, noncumulative
preferred stock and 2,000,000 shares of no-par common stock. The corporation assigned a $5 stated
value to the common stock. At December 31, 2011, the ledger contained the following balances
pertaining to stockholders' equity.
Paid-in Capital in Excess of Par Value-Preferred
Paid-in Capital in Excess of Stated Value-Common
Treasury Stock-Common (1,000 shares)
Paid-in Capital from Treasury Stock
The preferred stock was issued for land having a fair market value of $296,000. All common stock
issued was for cash. In November, 1,500 shares of common stock were purchased for the treasury at
a per share cost of $22. In December, 500 shares of treasury stock were sold for $28 per share. No
dividends were declared in 2011.
Prepare the journal entries for the:
(For multiple debit/credit entries, list amounts from largest
to smallest e.g. 10, 5, 3, 2.)
Issuance of preferred stock for land.
Issuance of common stock for cash.
Purchase of common treasury stock for cash.
Sale of treasury stock for cash.