Reference no: EM131782778
Assignment
Donnie Hilfiger has two classes of stock authorized: $1 par preferred and $0.01 par value common. As of the beginning of 2018, 400 shares of preferred stock and 5,000 shares of common stock have been issued. The following transactions affect stockholders' equity during 2018:
March 1 Issues 2,100 shares of common stock for $52 per share.
May 15 Purchase 500 shares of treasury stock for $45 per share.
July 10 Reissues 300 shares of treasury stock purchased on May 15 for $50 per share.
October 15 Issues 300 shares of preferred stock for $55 per share.
December 1 Declare a cash dividend on both common and preferred stock of $1.50 per share to all stockholders of record on December 15. (Hint: Dividends are not paid on treasury stock.)
December 31 Pay the cash dividends declared on December 1.
Donnie Hilfiger has the following beginning balances in its stockholders' equity accounts on January 1, 2018: Preferred Stock, $400; Common Stock, $50; Additional Paid-in Capital, $81,000; and Retained Earnings, $32,500. Net income for the year ended December 31, 2018, is $12,800.
Required:
1. Record each of these transactions.
Record the issue of common stock (March 1, 2018)
Record the purchase of treasury stock (May 15, 2018)
Recored reissue of treasury stock purchase (July 10, 2018)
Record the issue of preferred stock (October 15, 2018)
Record the declaration of cash dividend (December 1, 2018)
Record the entry on the date of record (December 15, 2018)
Record the payment of cash dividends declared (December 31, 2018)
Required
2. Select whether each of the following transactions increases ( + ) or decreases ( - ) total assets, total liabilities, and total stockholders' equity by completing the following table
Transaction
issue common stock
repurchase treasury stock
reissue treasury stock
issue preferred stock
declare cash dividends
pay cash dividends
And next to transaction column there is a total assets column, and then a total liabilities column, and then a total stockholders' equity column. So need to put (+) or (-) under of the total assets column, total liabilities column, and total stockholders' equity column for each of the 6 different transactions listed above.