Respuesta :
Answer and Explanation:
The Journal entries are shown below:-
1. Cash Dr, $4,06,00,000 (14,50,000 × $28)
To Common Stock Dr, $14,50,000 (14,50,000 × $1)
To Paid in Capital in Excess of par value - Common Stock $3,91,50,000
(Being issue of shares at the premium is recorded)
2. Dividend Dr, $43,50,000 (14,50,000 × $3)
To Dividend Payable $43,50,000
(Being declaration of the cash dividend is recorded)
3. Dividend payable Dr, $43,50,000
To Cash $43,50,000
(Being payment of cash dividend is recorded)
4. Treasury Stock Dr, $95,70,000 (2,90,000 × $33)
To Cash $95,70,000
(Being Purchase of the Treasury stock is recorded)
5. Cash Dr, $56,55,000 (1,45,000 × $39)
To Treasury Stock $47,85,000 (1,45,000 × $33)
To Paid in Capital in Excess of par value - Common Stock $8,70,000
(Being Reissue of the stock is recorded)
B. The Preparation of stockholders' equity section of the balance sheet as of December 31, 2018 is prepared below:-
Stockholder's Equity
For the year ended 31 Dec, 2018
Particulars Amount
Paid in Capital
Common Stock $14,50,000
Paid in Capital in excess of Par - Common $3,91,50,000
Paid in Capital in excess of Par - Treasury $8,70,000
Retained Earnings ($7,000,000)
Less: Dividend ($43,50,000) $26,50,000
Less: Treasury Stock ($47,85,000)
Total Stockholder's Equity $3,93,35,000
