I Value 10 points On January 1 2017 Triad Corporation had 60

I. Value 10 points On January 1, 2017, Triad Corporation had 60,000 shares of $1 par value common stock issued and outstanding. During the year, the following transactions occurred: Mar. Issued 25,000 shares of common stock for $550,000 June Declared a cash dividend of $2.00 per share to stockholders of record on June 15. June 30 Paid the $2.00 cash dividend. Dec. Purchased 5,000 shares of common stock for the treasury for $22 per share Dec. 15 Declared a cash dividend on outstanding shares of $2.25 per share to stockholders of record on December 31 Instructions Prepare journal entries to record the above transactions.

Solution

Date Account titles and explanation Debit Credit Mar. 1 Cash $550,000 Common Stock $25,000 Paid-in Capital in Excess of Par $525,000 June 1 Cash Dividends $170,000 Dividends Payable(85,000 × $2 = $170,000) $170,000 June 30 Dividends Payable $170,000 Cash $170,000 Dec. 1 Treasury Stock $110,000 Cash $110,000 Dec. 15 Cash Dividends (80,000 × $2.25) $180,000 Dividends Payable $180,000