ACCT 121 Lecture Notes - Lecture 2: Financial Statement

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9 May 2020

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Journalizing: entering transaction data in the journal is known as journalizing. Companies make separate journal entries for each transaction: a complete entry consists of (1) the date of the transaction, (2) the accounts and amounts to be debited and credited, and (3) a brief explanation of the transaction. On september 1, stockholders invested ,000 cash in the corporation in exchange for common stock, and softbyte purchased computer equipment for ,000 cash. The number j1 indicates that these two entries are recorded on the first page of the journal. 1 the date of the transaction is entered in the date column. The blank space separates individual journal entries and makes the entire journal easier to read. journal entry is made. This column is used later when the journal entries are transferred to the ledger accounts. 4 a brief explanation of the transaction appears on the line below the credit.

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Sarasota Corp. has been authorized to issue 20,400 shares of $100 par value, 6%, noncumulative preferred stock and 1,140,000 shares of no-par common stock. The corporation assigned a $4 stated value to the common stock. At December 31, 2017, the ledger contained the following balances pertaining to stockholdersâ equity. Preferred Stock $154,000 Paid-in Capital in Excess of Par ValueâPreferred Stock 21,400 Common Stock 1,980,000 Paid-in Capital in Excess of Stated ValueâCommon Stock 1,550,000 Treasury Stock (4,400 common shares) 35,200 Retained Earnings 82,600 Accumulated Other Comprehensive Income 49,400 The preferred stock was issued for $175,400 cash. All common stock issued was for cash. In November 4,400 shares of common stock were purchased for the treasury at a per share cost of $8. No dividends were declared in 2017. Prepare the journal entries for the following. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (1) Issuance of preferred stock for cash. (2) Issuance of common stock for cash. (3) Purchase of common treasury stock for cash. No. Account Titles and Explanation Debit Credit 1. enter an account title to record the first transaction enter a debit amount enter a credit amount enter an account title to record the first transaction enter a debit amount enter a credit amount enter an account title to record the first transaction enter a debit amount enter a credit amount 2. enter an account title to record the second transaction enter a debit amount enter a credit amount enter an account title to record the second transaction enter a debit amount enter a credit amount enter an account title to record the second transaction enter a debit amount enter a credit amount 3. enter an account title to record the third transaction enter a debit amount enter a credit amount enter an account title to record the third transaction enter a debit amount enter a credit amount Prepare the stockholdersâ equity section of the balance sheet at December 31, 2017.

rubyhorse181

Exercise 13-7 On January 1, 2017, the stockholdersâ equity section of Newlin Corporation shows common stock ($6 par value) $1,800,000; paid-in capital in excess of par $1,050,000; and retained earnings $1,230,000. During the year, the following treasury stock transactions occurred. Mar. 1 Purchased 51,000 shares for cash at $15 per share. July 1 Sold 12,000 treasury shares for cash at $17 per share. Sept. 1 Sold 10,000 treasury shares for cash at $14 per share. Journalize the treasury stock transactions. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Sept. 1 Show List of Accounts Restate the entry for September 1, assuming the treasury shares were sold at $12 per share. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date Account Titles and Explanation Debit Credit Sept. 1

brownkangaroo236

Sunland Company Ltd. publishes a monthly sports magazine, Fishing Preview. Subscriptions to the magazine cost $15 per year. During November 2017, Sunland sells 12,320 subscriptions for cash, beginning with the December issue. Sunland prepares financial statements quarterly and recognizes subscription revenue at the end of the quarter. The company uses the accounts Unearned Subscription Revenue and Subscription Revenue. The company has a December 31 year-end. Prepare the entry in November for the receipt of the subscriptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Nov. Prepare the adjusting entry at December 31, 2017, to record subscription revenue in December 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31 Prepare the adjusting entry at March 31, 2018, to record subscription revenue in the first quarter of 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Mar. 31

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ACCT 121 Lecture Notes - Lecture 2: Financial Statement

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