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Franko Company. was incorporated on 2/01/14. Their corporate charter authorized the following capital stock:

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Franko Company. was incorporated on 2/01/14. Their corporate charter authorized the following capital stock;Preferred Stock: 7%, par value $105 per share, 120,000 shares.;Common Stock: $5 par value, 1,000,000 shares.;The following transactions occurred during the year;3/15/14 ? Issued 200,000 shares of common stock for $18 cash per share.;4/25/14 ? Issued 7,000 shares of preferred stock for $125 cash per share.;8/16/14 ? Repurchased 40,000 shares of common stock for $25 cash per share.;10/5/14 ? Declared dividend of $150,000.;Required;1. Prepare the journal entry for each transaction listed above.;2. In your own words, explain the main differences between common and preferred stock.

 

Paper#76447 | Written in 18-Jul-2015

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