Question

Selected transactions completed by Primo Discount Corporationduring the current fiscal year are as follows:

Jan.	9	Split the common stock The stock outstanding when a corporation has issued only oneclass of stock. 3 for 1 and reduced the par A dollar amount assigned to each share of stock. from $75 to $25 per share. After the split, there were 1,201,500common shares outstanding.
Feb.	28	Purchased 40,200 shares of the corporation’s own common stockat $27, recording the stock Shares of ownership of a corporation. at cost.
May	1	Declared semiannual dividends Distribution of a corporation’s earnings to stockholders. of $0.70 on 70,500 shares of preferred stock A class of stock with preferential rights over common stock. and $0.14 on the common stock to stockholders The owners of a corporation. of record on June 1, payable on July 10.
Jul.	10	Paid the cash dividends A cash distribution of earnings by a corporation to itsshareholders. .
Sep.	7	Sold 31,600 shares of treasury stock Stock that a corporation has once issued and thenreacquires. at $33, receiving cash.
Oct.	1	Declared semiannual dividends of $0.70 on the preferred stockand $0.14 on the common stock (before the stock dividend). Inaddition, a 2% common stock dividend A distribution of shares of stock to its stockholders. was declared on the common stock outstanding. The fair market valueof the common stock is estimated at $38.
Dec.	1	Paid the cash dividends and issued the certificates for thecommon stock dividend.

Journalize the transactions. If no entry is required, simplyskip to the next transaction. Refer to the Chart of Accounts forexact wording of account titles.

CHART OF ACCOUNTS

Primo Discount Corporation

General Ledger

	ASSETS
110	Cash
120	Accounts Receivable
131	Notes Receivable
132	Interest Receivable
141	Merchandise Inventory
145	Office Supplies
151	Prepaid Insurance
181	Land
193	Equipment
194	Accumulated Depreciation-Equipment

	LIABILITIES
210	Accounts Payable
221	Notes Payable
226	Interest Payable
231	Cash Dividends Payable
236	Stock Dividends Distributable
241	Salaries Payable
261	Mortgage Note Payable

EQUITY

311

Common Stock

312

Paid-In Capital in Excess of Par-Common Stock

315

Treasury Stock

321

Preferred Stock

322

Paid-In Capital in Excess of Par-Preferred Stock

331

Paid-In Capital from Sale of Treasury Stock

340

Retained Earnings

351

Cash Dividends

352

Stock Dividends

390

Income Summary

Journalize the transactions. If no entry is required, simplyskip to the next transaction. Refer to the Chart of Accounts forexact wording of account titles.

PAGE 10

JOURNAL

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Merchandise Sold
515	Credit Card Expense
520	Salaries Expense
531	Advertising Expense
532	Delivery Expense
533	Selling Expenses
534	Rent Expense
535	Insurance Expense
536	Office Supplies Expense
537	Organizational Expenses
562	Depreciation Expense-Equipment
590	Miscellaneous Expense
710	Interest Expense