Exam 13: Corporations

A corporation is a separate legal entity that is organized independently of its owners.

When stock is issued for assets other than cash,the transaction is always recorded at the market value of the stock issued.

From its inception through the year of 2016,Quicksales,Inc.was profitable and made strong dividend payments each year.In the year 2017,Quicksales had major losses and paid no dividends.In 2018,the company started making large profits again,and they were able to pay dividends to all shareholders-both common and preferred.There are 2,100 shares of cumulative,12% preferred stock outstanding.The preferred stock has a par value of $100.What is the total amount of dividends that should be paid to the preferred stockholders in December,2018?

Micro Electronics completed the following stock issuance transactions: Prepare the journal entries to record these transactions.Explanations are not required.

What is a prior-period adjustment? How and when is a prior-period adjustment recorded?

Bradley Corporation received cash from issuing 10,000 shares of common stock at par on January 1,2017.The stock has a par value of $0.01 per share.Which is the correct journal entry to record this transaction?