Purpose journal entries to record these transactions

Assignment Help Financial Accounting

Reference no: EM133549

Question :

Problem 1

Part A

In late 2010, the Nicklaus Corporation was produced. The corporate charter authorizes the issuance of 20,000,000 shares of general stock carrying a $1 par value. On 2^nd January, 2011, 3,000,000 shares of the regular stock are issued in exchange for cash at an average price of $10 per share.

Required:

1. Organize journal entries to record this transaction.

2. Organize the shareholders' equity section of the Nicklaus balance sheet as 31^st March, 2011. (Suppose net income for the first quarter 2011 was $1,000,000.)

Part B

Through 2011, the Nicklaus Corporation contributed in three treasury stock transactions:

a. On 30^th June, 2011, the corporation reacquires 200,000 shares for the funds at a price of $12 per share.

b. On 31^st July, 2011, 50,000 funds shares are reissued at $15 per share.

c. On 30^th September, 2011, 50,000 treasury shares are reissued at $10 per share.

Required:

1. Purpose journal entries to record these transactions.

2. Create the Nicklaus Corporation shareholders' equity section as it would show in a balance sheet prepared at September 30, 2011. (Suppose net income for the second and third quarter was $3,000,000.)

Reference no: EM133549

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