The stockholders’ equity of Summit Corporation at January 1 follows:7 Percent preferred stock, $100 par value, 20,000 shares authorized; 5,000 shares issued and outstanding$500,000Common stock, $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding600,000Paid-in capital in excess of par value-Preferred stock24,000Paid-in capital in excess of par value-Common stock360,000Retained earnings325,000Total Stockholders' Equity$1,809,000 The following transactions, among others, occurred during the year:Jan.12Announced a 3-for-1 common stock split, reducing the par value of the common stock to $5 per share. The authorization was increased to 300,000 shares.Mar.31Converted $42,000 face value of convertible bonds payable (the book value of the bonds was $46,000) to common stock. Each $1,000 bond converted to 125 shares of common stock.June1Acquired equipment with a fair market value of $60,000 in exchange for 600 shares of preferred stock.Sept.1Acquired 10,000 shares of common stock for cash at $16 per share.Oct.12Sold 1,500 treasury shares at $18 per share.Nov.21Issued 5,000 shares of common stock at $13 per share.Dec.28Sold 1,200 treasury shares at $14 per share. 31Closed net income of $85,000 to the Retained Earnings account. Required Prepare journal entries for the given transactions and post them to the T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders’ equity accounts.Prepare the stockholders’ equity section of the balance sheet at December 31. Journal entriesT-AccountsStockholder's equity sectionGeneral JournalDateDescriptionDebitCreditJan.12(Memorandum) Common Stock split 3 for 1. Mar.31AnswerAnswerAnswer Premium on Bonds PayableAnswerAnswer Common StockAnswerAnswer AnswerAnswerAnswer To record conversions of bonds. Jun.01AnswerAnswerAnswer AnswerAnswerAnswer Issued preferred stock in exchange for equipment. Sept.01AnswerAnswerAnswer AnswerAnswerAnswer Purchased treasury stock. Oct.12AnswerAnswerAnswer Treasury Stock - CommonAnswerAnswer AnswerAnswerAnswer Sold treasury stock. Nov.21AnswerAnswerAnswer Common StockAnswerAnswer AnswerAnswerAnswer Issued common stock. Dec.28AnswerAnswerAnswer Paid-in-Capital from Treasury StockAnswerAnswer AnswerAnswerAnswer To record sale of treasury stock. CashSept.01AnswerAnswer Oct.12AnswerAnswer Nov.21AnswerAnswer Dec.28AnswerAnswer Bonds PayableMar.31AnswerAnswer Premium on Bonds PayableMar.31AnswerAnswer EquipmentJun.01AnswerAnswer Preferred StockBeg. bal 500,000 Jun.01AnswerAnswer BalAnswerAnswer Common StockBeg. bal 600,000 Jan.12 (3 for 1 split) Mar.31AnswerAnswer Nov.21AnswerAnswer Bal.AnswerAnswer Paid-in-Capital in Excess of Par Value - Preferred StockBeg. bal 24,000 Jun.01AnswerAnswer Bal.AnswerAnswer Paid-in-Capital in Excess of Par Value - Common StockBeg. bal 360,000 Mar.31AnswerAnswer Nov.21AnswerAnswer Bal.AnswerAnswer Paid-in-Capital from Treasury StockOct.12AnswerAnswer Dec.28AnswerAnswer Bal.AnswerAnswer Treasury Stock - CommonSept.01AnswerAnswer Oct.12AnswerAnswer Dec.28AnswerAnswer Bal.AnswerAnswer Retained EarningsBeg. bal 325,000 Dec.31AnswerAnswer Bal.AnswerAnswer Do not use negative signs with answers.Stockholders' Equity Paid in Capital AnswerAnswer AnswerAnswerAnswer Additional Paid-in-Capital Paid-in-Capital in Excess of Par value -Preferred StockAnswer Paid-in-Capital in Excess of Par value - Common StockAnswer AnswerAnswerAnswer Total Paid-in-Capital Answer Answer Answer Answer Answer Answer Answer AnswerPlease answer all parts of the question.

answers Journal entries, ledger accounts an stockholders equity account is as prepared below:…

Answered: The stockholders’ equity of Summit…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter20: Corporations: Organization And Capital Stock

Section: Chapter Questions

Problem 1MP: Stockholders equity accounts and other related accounts of Gonzales Company as of January 1, 20--,...

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Question

The stockholders’ equity of Summit Corporation at January 1 follows:

7 Percent preferred stock, $100 par value, 20,000 shares authorized;
5,000 shares issued and outstanding	$500,000
Common stock, $15 par value, 100,000 shares authorized;
40,000 shares issued and outstanding	600,000
Paid-in capital in excess of par value-Preferred stock	24,000
Paid-in capital in excess of par value-Common stock	360,000
Retained earnings	325,000
Total Stockholders' Equity	$1,809,000

The following transactions, among others, occurred during the year:

Jan.	12	Announced a 3-for-1 common stock split, reducing the par value of the common stock to $5 per share. The authorization was increased to 300,000 shares.
Mar.	31	Converted $42,000 face value of convertible bonds payable (the book value of the bonds was $46,000) to common stock. Each $1,000 bond converted to 125 shares of common stock.
June	1	Acquired equipment with a fair market value of $60,000 in exchange for 600 shares of preferred stock.
Sept.	1	Acquired 10,000 shares of common stock for cash at $16 per share.
Oct.	12	Sold 1,500 treasury shares at $18 per share.
Nov.	21	Issued 5,000 shares of common stock at $13 per share.
Dec.	28	Sold 1,200 treasury shares at $14 per share.
	31	Closed net income of $85,000 to the Retained Earnings account.

Required

Prepare journal entries for the given transactions and post them to the T-accounts. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders’ equity accounts.
Prepare the stockholders’ equity section of the balance sheet at December 31.

Journal entries
T-Accounts
Stockholder's equity section

General Journal
Date	Description	Debit	Credit
Jan.12	(Memorandum) Common Stock split 3 for 1.
Mar.31	Answer	Answer	Answer
	Premium on Bonds Payable	Answer	Answer
	Common Stock	Answer	Answer
	Answer	Answer	Answer
	To record conversions of bonds.
Jun.01	Answer	Answer	Answer
	Answer	Answer	Answer
	Issued preferred stock in exchange for equipment.
Sept.01	Answer	Answer	Answer
	Answer	Answer	Answer
	Purchased treasury stock.
Oct.12	Answer	Answer	Answer
	Treasury Stock - Common	Answer	Answer
	Answer	Answer	Answer
	Sold treasury stock.
Nov.21	Answer	Answer	Answer
	Common Stock	Answer	Answer
	Answer	Answer	Answer
	Issued common stock.
Dec.28	Answer	Answer	Answer
	Paid-in-Capital from Treasury Stock	Answer	Answer
	Answer	Answer	Answer
	To record sale of treasury stock.

Cash
Sept.01	Answer	Answer
Oct.12	Answer	Answer
Nov.21	Answer	Answer
Dec.28	Answer	Answer

Bonds Payable
Mar.31	Answer	Answer

Premium on Bonds Payable
Mar.31	Answer	Answer

Equipment
Jun.01	Answer	Answer

Preferred Stock
Beg. bal		500,000
Jun.01	Answer	Answer
Bal	Answer	Answer

Common Stock
Beg. bal		600,000
Jan.12		(3 for 1 split)
Mar.31	Answer	Answer
Nov.21	Answer	Answer
Bal.	Answer	Answer

Paid-in-Capital in Excess of Par Value - Preferred Stock
Beg. bal		24,000
Jun.01	Answer	Answer
Bal.	Answer	Answer

Paid-in-Capital in Excess of Par Value - Common Stock
Beg. bal		360,000
Mar.31	Answer	Answer
Nov.21	Answer	Answer
Bal.	Answer	Answer

Paid-in-Capital from Treasury Stock
Oct.12	Answer	Answer
Dec.28	Answer	Answer
Bal.	Answer	Answer

Treasury Stock - Common
Sept.01	Answer	Answer
Oct.12	Answer	Answer
Dec.28	Answer	Answer
Bal.	Answer	Answer

Retained Earnings
Beg. bal		325,000
Dec.31	Answer	Answer
Bal.	Answer	Answer

Do not use negative signs with answers.


Paid in Capital
Answer	Answer
Answer	Answer	Answer
Additional Paid-in-Capital
Paid-in-Capital in Excess of Par value -Preferred Stock	Answer
Paid-in-Capital in Excess of Par value - Common Stock	Answer
Answer	Answer	Answer
Total Paid-in-Capital		Answer
Answer		Answer
		Answer
Answer		Answer
Answer		Answer

Please answer all parts of the question.

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