There are 2 problems - 11.4A and 11.6A
11.4 A -
Early in the year bill Barnes and several friends organized a corp known as Barnes communiations, inc. The corporation was authorized to issue 50,000 shares of $100 Par value, 10% cumulative preferred stock, and 400,000 shares of $2 par value common stock. the following transactions (among others) occurred during the year:
Jan. 6 - Issued for ash 20,000 shares of common stock at $14 per share. These shares were issue to Barnes and 10 other investors.
Jan 7. - Issued an additional 500 shares of common stock to Barnes in exchange for his services in organizing the company. The stockholders agreed that these services were worth $7,000.
Jan. 12 Issued 2,500 shares of preferred stock for cash of $250,000
June 4 - Acquired land as a building site in exchange for 15,000 shares of common stock. In view of the appraised value of the land and the progress of the company, the directors agreed that the common stock was to be valued for purposes of this transaction at $15 per share.
Nov 15 - The first annual dividend of $10 per share was declared on the preferred stock to be paid Dec. 20
Dec. 20 - Paid the cash dividend declared on Nov 15
Dec 31 - After the revenue and the expenses were closed into the income summary account, that account indicated a net income of $147,200.
1. Prepared journal entries in general ledger form to record the above transactions. Includes entried at dec 31 to close the income summary account and the divdends account.
2. Prepare the stockholders equity section of the Barnes communications Inc. balance sheet at Dec. 31.
Parson, Inc. is a publicly owned company. the following info is excerpted from a recent balance sheet. Dollar amounts (except per share amounts are stated in thousands)
Convertible $17.20 perferred stock, $250 par value, 1,000,000 shares authorized;345,000 shares issued and outstanding............$86,250
Common stock, par value $.50,25,000,000 shares authorized..........$6,819
Additional paid in capital............87,260
Total Stockholder's equity............$237,592
a. How many shares of common stock have been issued?
b. What is the total amuont of the annual dividends paid to preferrred stockholders?
c. What is the total amount of paid in capital?
d. What is the book value per share of common stock?
e. Briefly explain the advantages and disadvantages to Parsons of being publicly ownened rather than being privately owned.
f. What is meant by the term convertible used in the the preferred stock?
g. Assume that preferred stock is selling at $248 per share. does this provide a higher or lower dividend yield than 8%, $50 par value preferrred with a market price of $57 per share. Show computations and explain why one preferred stock might yield less than another.