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 390,000 shares of common stock with $1.00 par value. The land has been appraised at a market value of $1,520,000. ii) The company sold 140,000 shares of common stock with $1 par value. iii) Issued 26,000 shares of $22 par value preferred stock. Shares were issued at par. iv) Earned net income of $950,000 v) Dividend declared and paid-$0.15 per share on common stock. vi) Dividend declared and paid-$5 per share on preferred stock. Required: a) Prepare the Journal entries and closing entries for the above transaction b) Prepare the owner’s equity section of the balance sheet based on the info above.
The company's charter authorizes 1,000,000 shares of common stock and 100,000
i) KY Jewelers purchased a piece of land from the original owner. In payment for the land, KY Jewelers issues 390,000 shares of common stock with $1.00 par value. The land has been appraised at a market value of $1,520,000.
ii) The company sold 140,000 shares of common stock with $1 par value.
iii) Issued 26,000 shares of $22 par value preferred stock. Shares were issued at par.
iv) Earned net income of $950,000
v) Dividend declared and paid-$0.15 per share on common stock.
vi) Dividend declared and paid-$5 per share on preferred stock.
Required:
a) Prepare the
b) Prepare the owner’s equity section of the balance sheet based on the info above.
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