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GarryVolchara [31]
3 years ago
12

Worldwide Company obtained a charter from the state in January that authorized 200,000 shares of common stock, $10 par value. Du

ring the first year, the company earned $38,900, declared no dividends, and the following selected transactions occurred in the order given:
a. Issued 67,000 shares of the common stock at $11 cash per share. b. Reacquired 2,700 shares at $14 cash per share from stockholders; the shares are now held in the treasury.
c. Reissued 1,350 of the shares in the transaction (b) two months later at $17 cash per share.
1. Indicating the account, amount, and direction of the effect on the above transaction
2. Prepare journal entries to record each transaction
3. Prepare the stockholders’ equity section of the balance sheet at December 31.
Business
1 answer:
Rom4ik [11]3 years ago
7 0

Answer:

Check the explanation

Explanation:

In the books of Worldwide Company:

Transaction General Journal                                 Debit         Credit

/ Event                                                                         $                $

a.        Cash ( 67,000 shares x $ 11 per share )       737,000  

         Common Stock ( 67,000 shares x $ 10 per share)         670,000

Paid-in Capital in Excess of Par: Common Stock                       67,000

b.Treasury Stock ( 2,700 shares x $ 14 per share)37,800  

                               Cash                                                               37,800

c. Cash ( 1,350 shares x $ 17 per share)                   22,950  

Treasury Stock ( 1,350 shares x $ 14 per share )                       18,900

Paid-in Capital : Treasury Stock                                                  4,050

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A 180-day $3 million CD has a 4.25 percent annual rate quote. If you buy the CD, how much will you collect in 180 days?
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Answer:

$3,063,750

Explanation:

A 180 day $3,000,000 CD

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Collection in 180 days = ?

$3,000,000 * 4.25% * 180/360

= $3,000,000 *  0.02125

= $63,750

Total amount to collect after 180 days = $3,000,000 + $63,750

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3 years ago
It is argued that LIFO should not be allowed to compute net income because a. it does not match costs to revenues, especially wh
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Answer:

d. it causes profits to be understated when prices are rising and allows a company to dodge taxes.

Explanation:

The LIFO method should not be permitted to determine the net income as in this case the profits would be understated at the time when price is increased due to this it permits the company to dodge taxes as the inventory consumed in the production process also the high inventory value would be involved in the cost of sales that represent the high cost, this result in lower profits and taxes

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3 years ago
Dave and his friend Stewart each owns 50 percent of KBS. During the year, Dave receives $75,000
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Answer: $12717

Explanation:

1. The amount of FICA and/or self-employment tax that Dave is required to pay on his compensation and his

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= 7.65/100 × $75000

= 0.0765 × $75000

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2. As an S Corporation will be:

= 7.65% × $75000

= 7.65/100 × $75000

= 0.0765 × $75000

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3. As a limited liability company will be:

Dave's compensation = 75,000

Dave's portion of income will be calculated as:

= 50% × $30,000

= 0.5 × $30,000

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Total will then be:

= $75000 + $15000 = $90000

We then calculate the net earnings which will be:

= 92.35% × $90000

= 0.9235 × $90000

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The FICA and/or self-employment tax that Dave is required to pay will then be:

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8 0
2 years ago
Assume that a firm hires an additional employee. If the marginal product for that employee is greater than for the previous empl
Tom [10]

If the marginal product for that employee is greater than for the previous employee hired, it must be that there are gains from specialization

<h3>What is marginal product ?</h3>
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To learn more about marginal product with the given link

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8 0
1 year ago
Crane Company issued common stock for proceeds of $389000 during 2019. The company paid dividends of $88000 and issued a long-te
ivann1987 [24]

Answer:

$284,000

Explanation:

Calculation to determine what The financing section of the statement of cash flows will report net cash inflows of

Using this formula

Net cash inflows=Common stock-Dividends-Treasury stock

Let plug in the formula

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Net cash inflows=$284,000

Therefore The financing section of the statement of cash flows will report net cash inflows of $284,000

6 0
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