Answered: Nash Company reported the following…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity

Section: Chapter Questions

Problem 12E

See similar textbooks

Related questions

Question

Print by: Tanvi Varma
374275:374275: Intermediate Accounting Theory and Practice MGMT X 120B (Summer 2020) / Ch. 15 HW

*Exercise 15-18

Nash Company reported the following amounts in the stockholders’ equity section of its December 31, 2019, balance sheet.

Preferred stock, 9%, $100 par (10,000 shares authorized, 1,800 shares issued)		$180,000
Common stock, $5 par (96,000 shares authorized, 19,200 shares issued)		96,000
Additional paid-in capital		113,000
Retained earnings		449,000
Total		$838,000

During 2020, Nash took part in the following transactions concerning stockholders’ equity.

1.		Paid the annual 2019 $9 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019.
2.		Purchased 1,800 shares of its own outstanding common stock for $42 per share. Nash uses the cost method.
3.		Reissued 800 treasury shares for land valued at $34,500.
4.		Issued 460 shares of preferred stock at $104 per share.
5.		Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $49 per share.
6.		Issued the stock dividend.
7.		Declared the annual 2020 $9 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2021.


	Your answer is partially correct. Try again.

Prepare journal entries to record the transactions described above. (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.)

No.	Account Titles and Explanation	Debit	Credit
1.	Dividends Payable - Preferred	16200
	Dividends Payable - Common	38400
	Cash		54600
2.	Treasury Stock	75600
	Cash		75600
3.	Land	34500
	Treasury Stock		33600
	Paid-in Capital from Treasury Stock		900
4.	Cash	47840
	Preferred Stock		46000
	Paid-in Capital in Excess of Par - Preferred Stock		1840
5.	Retained Earnings
	Common Stock Dividend Distributable
	Paid-in Capital in Excess of Par - Common Stock
6.	Common Stock Dividend Distributable
	Common Stock
7.	Retained Earnings
	Dividends Payable - Preferred
	Dividends Payable - Common


	Your answer is partially correct. Try again.

Prepare the December 31, 2020, stockholders’ equity section. Assume 2020 net income was $327,000. (Enter account name only .Do not provide any descriptive information.)

NASH COMPANY Stockholders’ Equity December 31, 2020
Capital Stock
Preferred Stock			$
Common Stock
Total Capital Stock
Additional Paid-in Capital
Total Paid-in Capital
Retained Earnings
Total Paid-in Capital and Retained Earnings
Less : Treasury Stock
Total Stockholders' Equity			$

Question Attempts: Unlimited

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 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.