In this scenario, you are presented with the company’s financial records. This activity requires vigilance and a keen eye for details which is crucial as the information presented will challenge your ability to use good reasoning and critical thinking to analyze the financial data presented. You are required to only use the figures in line with your surname initial which is D. Please Answer Question 2 A Steve Osbourne is considering opening a business, but the major decision faced is how to organize the business. Steve anticipates generating a massive profit during the first year and that the following years should be relatively profitable. Although he has enough to start the business now as a partnership, he believes cash flow may be an issue as the company grows. Steve believes that the corporate form of operation will be his best option and have hired you as a consultant and seek your advice. Requirements: Answer the following questions for Steve. a. Explain the corporate characteristic termed “no mutual agency” b. Explain the corporate characteristic termed limited liability. c. Explain the term outstanding stock. d. Is it true or false that corporations muse issue common stock, but may or may not decide to issue preferred stock? e. Is it true or false that all forms and classes of stock carry voting rights? f. Is it true of false that stock sold for amounts in excess of par value results in a gain reported on the income statement? 2. The company is desirous of comparing serval financial transactions and possible outcomes to assist in guiding its decision-making process. It is assumed that the company will be formed on January 1, 2021 and registered as Osbourne Corporation. The company’s charter will authorize 1,000,000 shares of common stock and 400,000, $100 par value, 5% cumulative preferred stock. They have asked each student from your accounting course to prepare the company’s journal entries and statement of owner’s equity based on the following information which is grouped according to your surname name initial. (Hint!!!! Example surname Manuel will use the initial M and that person should only use the info presented in line with the heading with their surname initial. You are not allowed to use info associated other initials other than that of your own as this will result in the forfeiture of the grade.) (Please to rules above on double-barrel surnames) Issued ________shares of common stock. Stock has par value of ___ per share and was issued at $____ per share. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname # of shares issued Per value Issue price A, P, I, E, V 5,000 0.01 30.00 C, O R, Y 15,000 0.10 30.00 K, Q, M, F 45,500 0.30 30.00 S, W, G, Z 65,000 0.40 30.00 D, T, L, U 80,000 0.50 30.00 N, B J, X, H 100,000 0.60 30.00 Issued _______ shares of preferred stock at par value as payment in exchange for legal services. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname Initial # of shares issued A, P, I, E, V 2,000 C, O R, Y 5,000 K, Q, M, F 8,000 S, W, G, Z 10,000 D, T, L, U 12,000 N, B J, X, H 14,000 Exchanged ______ shares of common stock for land with an appraised value of $______ and a building with an appraised value of $_____. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname # of shares issued value of land Value of building A, P, I, E, V 100,000 250,000.00 450,000.00 C, O R, Y 120,000 300,000.00 500,000.00 K, Q, M, F 160,000 400,000.00 650,000.00 S, W, G, Z 200,000 500,000.00 700,000.00 D, T, L, U 220,000 600,000.00 350,000.00 N, B, J, X, H 260,000 650,000.00 500,000.00 Earned Net income $______. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname Initial Net Income A, P, I, E, V 500,000.00 C, O R, Y 600,000.00 K, Q, M, F 650,000.00 S, W, G, Z 750,000.00 D, T, L, U 820,000.00 N, B J, X, H 900,000.00 Paid dividends to preferred shareholders as well as $2 per share to common stockholders. Using the info above and as a guide: a. Prepare the journal entries with narrations to record the following: The issuances of stock. Close out net income to retained earnings. Dividend paid. Close out dividend to retained earnings. B. Prepare Osbourne Corporation Stockholders equity section of the balance sheet at December 31, 2021. (Hint!!!!!!!) The following information must be clearly stated/shown: information on par values, the number of shares authorized and issued where necessary. the sub total for the total paid in capital. Retained earnings. total stockholders’ equity.

In this scenario, you are presented with the company’s financial records. This activity requires vigilance and a keen eye for details which is crucial as the information presented will challenge your ability to use good reasoning and critical thinking to analyze the financial data presented. You are required to only use the figures in line with your surname initial which is D. Please Answer Question 2 A Steve Osbourne is considering opening a business, but the major decision faced is how to organize the business. Steve anticipates generating a massive profit during the first year and that the following years should be relatively profitable. Although he has enough to start the business now as a partnership, he believes cash flow may be an issue as the company grows. Steve believes that the corporate form of operation will be his best option and have hired you as a consultant and seek your advice. Requirements: Answer the following questions for Steve. a. Explain the corporate characteristic termed “no mutual agency” b. Explain the corporate characteristic termed limited liability. c. Explain the term outstanding stock. d. Is it true or false that corporations muse issue common stock, but may or may not decide to issue preferred stock? e. Is it true or false that all forms and classes of stock carry voting rights? f. Is it true of false that stock sold for amounts in excess of par value results in a gain reported on the income statement? 2. The company is desirous of comparing serval financial transactions and possible outcomes to assist in guiding its decision-making process. It is assumed that the company will be formed on January 1, 2021 and registered as Osbourne Corporation. The company’s charter will authorize 1,000,000 shares of common stock and 400,000, $100 par value, 5% cumulative preferred stock. They have asked each student from your accounting course to prepare the company’s journal entries and statement of owner’s equity based on the following information which is grouped according to your surname name initial. (Hint!!!! Example surname Manuel will use the initial M and that person should only use the info presented in line with the heading with their surname initial. You are not allowed to use info associated other initials other than that of your own as this will result in the forfeiture of the grade.) (Please to rules above on double-barrel surnames) Issued ______shares of common stock. Stock has par value of _ per share and was issued at $ per share. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname # of shares issued Per value Issue price A, P, I, E, V 5,000 0.01 30.00 C, O R, Y 15,000 0.10 30.00 K, Q, M, F 45,500 0.30 30.00 S, W, G, Z 65,000 0.40 30.00 D, T, L, U 80,000 0.50 30.00 N, B J, X, H 100,000 0.60 30.00 Issued _ shares of preferred stock at par value as payment in exchange for legal services. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname Initial # of shares issued A, P, I, E, V 2,000 C, O R, Y 5,000 K, Q, M, F 8,000 S, W, G, Z 10,000 D, T, L, U 12,000 N, B J, X, H 14,000 Exchanged shares of common stock for land with an appraised value of $ and a building with an appraised value of $_. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname # of shares issued value of land Value of building A, P, I, E, V 100,000 250,000.00 450,000.00 C, O R, Y 120,000 300,000.00 500,000.00 K, Q, M, F 160,000 400,000.00 650,000.00 S, W, G, Z 200,000 500,000.00 700,000.00 D, T, L, U 220,000 600,000.00 350,000.00 N, B, J, X, H 260,000 650,000.00 500,000.00 Earned Net income $____. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space) Surname Initial Net Income A, P, I, E, V 500,000.00 C, O R, Y 600,000.00 K, Q, M, F 650,000.00 S, W, G, Z 750,000.00 D, T, L, U 820,000.00 N, B J, X, H 900,000.00 Paid dividends to preferred shareholders as well as $2 per share to common stockholders. Using the info above and as a guide: a. Prepare the journal entries with narrations to record the following: The issuances of stock. Close out net income to retained earnings. Dividend paid. Close out dividend to retained earnings. B. Prepare Osbourne Corporation Stockholders equity section of the balance sheet at December 31, 2021. (Hint!!!!!!!) The following information must be clearly stated/shown: information on par values, the number of shares authorized and issued where necessary. the sub total for the total paid in capital. Retained earnings. total stockholders’ equity.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter1: Role Of Accounting In Society

Section: Chapter Questions

Problem 8Q: Use the internet to research one manufacturing, one retail (or merchandising), and one service...

See similar textbooks

Related questions

Question

Please Answer Question 2 A

Steve Osbourne is considering opening a business, but the major decision faced is how to organize the business. Steve anticipates generating a massive profit during the first year and that the following years should be relatively profitable. Although he has enough to start the business now as a partnership, he believes cash flow may be an issue as the company grows. Steve believes that the corporate form of operation will be his best option and have hired you as a consultant and seek your advice.

Requirements:

Answer the following questions for Steve.

a. Explain the corporate characteristic termed “no mutual agency”

b. Explain the corporate characteristic termed limited liability.

c. Explain the term outstanding stock.

d. Is it true or false that corporations muse issue common stock, but may or may not decide to issue preferred stock?

e. Is it true or false that all forms and classes of stock carry voting rights?

f. Is it true of false that stock sold for amounts in excess of par value results in a gain reported on the income statement?

2. The company is desirous of comparing serval financial transactions and possible outcomes to assist in guiding its decision-making process. It is assumed that the company will be formed on January 1, 2021 and registered as Osbourne Corporation. The company’s charter will authorize 1,000,000 shares of common stock and 400,000, $100 par value, 5% cumulative preferred stock. They have asked each student from your accounting course to prepare the company’s journal entries and statement of owner’s equity based on the following information which is grouped according to your surname name initial. (Hint!!!! Example surname Manuel will use the initial M and that person should only use the info presented in line with the heading with their surname initial. You are not allowed to use info associated other initials other than that of your own as this will result in the forfeiture of the grade.) (Please to rules above on double-barrel surnames)

Issued ________shares of common stock. Stock has par value of ___ per share and was issued at $____ per share. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space)

Surname	# of shares issued	Per value	Issue price
A, P, I, E, V	5,000	0.01	30.00
C, O R, Y	15,000	0.10	30.00
K, Q, M, F	45,500	0.30	30.00
S, W, G, Z	65,000	0.40	30.00
D, T, L, U	80,000	0.50	30.00
N, B J, X, H	100,000	0.60	30.00

Issued _______ shares of preferred stock at par value as payment in exchange for legal services. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space)

Surname Initial	# of shares issued
A, P, I, E, V	2,000
C, O R, Y	5,000
K, Q, M, F	8,000
S, W, G, Z	10,000
D, T, L, U	12,000
N, B J, X, H	14,000

Exchanged ______ shares of common stock for land with an appraised value of $______ and a building with an appraised value of $_____. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space)

Surname	# of shares issued	value of land	Value of building
A, P, I, E, V	100,000	250,000.00	450,000.00
C, O R, Y	120,000	300,000.00	500,000.00
K, Q, M, F	160,000	400,000.00	650,000.00
S, W, G, Z	200,000	500,000.00	700,000.00
D, T, L, U	220,000	600,000.00	350,000.00
N, B, J, X, H	260,000	650,000.00	500,000.00

Earned Net income $______. (please refer to table below and use only the info in line with your surname initial in the blank/underlined space)

Surname Initial	Net Income
A, P, I, E, V	500,000.00
C, O R, Y	600,000.00
K, Q, M, F	650,000.00
S, W, G, Z	750,000.00
D, T, L, U	820,000.00
N, B J, X, H	900,000.00

Paid dividends to preferred shareholders as well as $2 per share to common stockholders.

Using the info above and as a guide:

a. Prepare the journal entries with narrations to record the following:

The issuances of stock.
Close out net income to retained earnings.
Dividend paid.
Close out dividend to retained earnings.

B. Prepare Osbourne Corporation Stockholders equity section of the balance sheet at December 31, 2021. (Hint!!!!!!!) The following information must be clearly stated/shown:

- information on par values,
- the number of shares authorized and issued where necessary.
- the sub total for the total paid in capital.
- Retained earnings.
- total stockholders’ equity.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.