Journal Entries A. Issued 10000 shares of $10 par common stock at $11, receiving cash. (6 points) B. Issued $ 200000 of 10 year 10% bonds at a market (effective) interest rate of 9%, with interest payable semiannually. (6 points) Use the Present Value Tables in Appendix A of text book. Round all calculations to the nearest dollar. C. Declared a dividend of $0.25 per share on common stock. On date of declaration, 32000 shares of common stock were outstanding. (3 points) D. Paid cash dividend from (c) above. (2 points) E. Purchased 12000 shares of Jones Company for $10 per share, plus $6000 commission. Our company purchased less than 20% of the outstanding stock of Jones Company. (3 points) F. Declared a 5% stock dividend on the $10 par common stock when the (6 points) market price was $ 25 per share. There were 32000 Shares outstanding. G. Distributed the stock dividends declared in (F). (2 points) H. Purchased $5000 of 5% bonds at par. (3 points) Interest is payable semiannually. I. Purchased 600 shares of treasury common stock for $12 per share. (3 points) J. Received semiannual interest from bonds purchased in (H). (3 points) K. Received a total cash dividend of $1200 from Jones Company. (3 points) L. Received a $2000 dividend from our investment in Masco Company stock. This investment is accounted for under the equity method. (3 points) Record the following journal entries for ABC Corporation on the journal in the provided Student Requirements and Basic Instructions: 1. Each student should complete the project on an individual basis. Tutors and others are not allowed to help students on the project. If a project is not completed on an independent, individual basis, the student will receive zero points for the project. 2. Instructors can only answer questions on the project in general. 3. Students should complete the project and turn it in to the dropbox by the due date. The instructor reserves the right to not accept late projects or deduct points on projects turned in past the due date. 4. There are different versions of the project that will be assigned (course mailed) by the instructor. 5. By submitting in the Canvas dropbox you are ″signing″ that you have followed the instructions above. M. Sold, at $17 per share, 300 shares of treasury common stock purchased in (I). (6 points) N. Sold 2400 shares of Jones company stock purchased in (E) for $13 per share, including commission. (6 points) O. Masco Company′s total earnings are $100000. We own 40%. Record the earnings for our company using the equity method. (3 points) P. Sold the bonds purchased in (H) at 103 plus $63 in accrued interest. (8 points) Q. At the end of the accounting period, the remaining shares of Jones Company stock increased $2.00 per share (3 Points) R. Record the payment of semiannual interest on the bonds issued in (B) and the amortization of the premium for six months. The amortization is determined using the straight-line method. (6 points) Round all calculations to the nearest dollar. Part 2 Instructions: Page 2 Debit Credit Cash 600,000 Accounts receivable 399,000 Allowance for doubtful accounts 20,000 Equity Investments at cost 100,000 Valuation allowance for Equity Investments 10,000 Merchandise inventory at lower of cost (FIFO) or market 40,000 Prepaid expenses 6,000 Interest receivable 4,000 Investment in Masco Company stock 30,000 Store buildings and equipment 610,000 Accumulated depreciation—store buildings and equipment 300,000 Accounts payable 176,800 Income tax payable 2,000 Bonds payable, 10%, due in 10 years 200,000 Premium on bonds payable 10,000 Retained earnings, January 1, 20X1 456,100 Cash dividends , January 1, 20X1 balance 0 Stock Dividends, January 1, 20X1 balance 0 Common stock, $10 par (100,000 shares authorized; 22000 shares outstanding), January 1, 20X1 220,000 Paid-in capital in excess of par—common stock, January 1, 20X1 22,000 Paid-in capital from sale of treasury stock, January 1, 20X1 0 Treasury stock, January 1, 20X1 0 Sales 1,400,000 Gain from sale of investment 2,000 Unrealized gain(loss) on Equity Investments 19,200 Dividend revenue 1,600 Interest revenue 5,400 Income of Masco Company 40,000 Cost of goods sold 800,000 Advertising expense $20,000 Depreciation expense—store buildings and equipment 14,000 Miscellaneous selling expenses 10,000 Sales commissions 40,000 Office rent expense 100,000 Office salaries expense 120,000 Miscellaneous administrative expenses 2,000 Interest expense 10,000 Income tax expense 80,000
