Reference no: EM132540933
Question - Novak Company reported the following amounts in the stockholders' equity section of its December 31, 2019, balance sheet.
Preferred stock, 10%, $100 par (10,000 shares authorized, 1,800 shares issued) 180,000
Common stock, $5 par (101,000 shares authorized, 20,200 shares issued) 101,000
Additional paid-in capital 119,000
Retained earnings 447,000
Total $847,000
During 2020, Novak took part in the following transactions concerning stockholders' equity.
1. Paid the annual 2019 $10 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019.
2. Purchased 1,500 shares of its own outstanding common stock for $37 per share. Novak uses the cost method.
3. Reissued 700 treasury shares for land valued at $28,400.
4. Issued 500 shares of preferred stock at $106 per share.
5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $48 per share.
6. Issued the stock dividend.
7. Declared the annual 2020 $10 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2021.
Required - Show journal entries to record the transactions described above.