The company’s charter authorizes 1,000,000 shares of common stock and 100,000 shares of preferred stock and the following are the transactions for consideration: i) KY Jewelers purchased a piece of land from the original owner. In payment for the land, KY Jewelers issues $350,00 shares of common stock with $1.00 par value. The land has been appraised at a market value of $1,350,000. ii) The company sold 110,000 shares of common stock with $1 par value. iii) Issued 22,000 shares of $18 par value preferred stock. Shares were issued at par. iv) Earned net income of $850,000. v) Dividend declared and paid - $0.15 per share on common stock vi) Dividend declared and paid - $5 per share on preferred stock Using the information above and as guided: A. Prepare the Journal entries and closing entries for the above transaction

Question

The company’s charter authorizes 1,000,000 shares of common stock and 100,000 shares of preferred stock and the following are the transactions for consideration:

i) KY Jewelers purchased a piece of land from the original owner. In payment for the land, KY Jewelers issues $350,00 shares of common stock with $1.00 par value. The land has been appraised at a market value of $1,350,000.

ii) The company sold 110,000 shares of common stock with $1 par value.

iii) Issued 22,000 shares of $18 par value preferred stock. Shares were issued at par.

iv) Earned net income of $850,000.

v) Dividend declared and paid - $0.15 per share on common stock

vi) Dividend declared and paid - $5 per share on preferred stock

Using the information above and as guided:

A. Prepare the Journal entries and closing entries for the above transaction

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