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Comprehensive Problem 4 Part 1: Selected tra...

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Comprehensive Problem 4 Part 1: Selected transactions completed by Everyday Products Inc. during the fiscal year ending December 31, 2012, were as follows: 1. Journalize the selected transactions. If no entry is required, select "No Entry Required" from the dropdown and leave the amount boxes blank. For a compound transaction, if an amount box does not require an entry, leave it blank. a. Issued 12,500 shares of $25 par common stock at $32, receiving cash. b. Issued 2,000 shares of $100 par preferred 5% stock at $105, receiving cash. c. Issued $400,000 of 10-year, 6% bonds at 105, with interest payable semiannually. d. Declared a quarterly dividend of $0.45 per share on common stock and $1.25 per share on preferred stock. On the date of record, 85,000 shares of common stock were outstanding, no treasury shares were held, and 17,000 shares of preferred stock were outstanding. e. Paid the cash dividends declared in (d). f. Purchased 5,500 shares of Kress Corp. at $22 per share, plus a $275 brokerage commission. The investment is classified as an available-for-sale investment. g. Purchased 6,500 shares of treasury common stock at $35 per share. h. Purchased 36,000 shares of Lifecare Co. stock directly from the founders for $18 per share. Lifecare has 112,500 shares issued and outstanding. Everyday Products Inc. treated the investment as an equity method investment. i. Declared a 2% stock dividend on common stock and a $1.25 quarterly cash dividend per share on preferred stock. On the date of declaration, the market value of the common stock was $40 per share. On the date of record, 85,000 shares of common stock had been issued, 6,500 shares of treasury common stock were held, and 17,000 shares of preferred stock had been issued. j. Issued the stock certificates for the stock dividends declared in (h) and paid the cash dividends to the preferred stockholders. k. Received $24,500 dividend from Lifecare Co. investment in (h). l. Purchased $62,000 of Nordic Wear Inc. 10-year, 6% bonds, directly from the issuing company at par value, plus accrued interest of $550. The bonds are classifed as a held-to-maturity long-term investment. m. Sold, at $42 per share, 2,600 shares of treasury common stock purchased in (g). n. Received a dividend of $0.65 per share from the Kress Corp. investment in (f). o. Sold 500 shares of Kress Corp. at $26.50, including commission. p. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization was determined using the straight-line method. q. Accrued interest for three months on the Nordic Wear Inc. bonds purchased in (l). r. Lifecare Co. recorded total earnings of $205,000. Everyday Products recorded equity earnings for its share of Lifecare Co. net income. s. The fair value for Kress Corp. stock was $18.50 per share on December 31, 2012. The investment is adjusted to fair value using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Comprehensive Problem 4 Part 2: Note: You must complete part 1 before part 2. After all of the transactions for the year ended December 31, 2012, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data below were taken from the records of Everyday Products Inc. On your own paper, in the working papers, or using a spreadsheet, prepare the following: a. Prepare a multiple-step income statement for the year ended December 31, 2012, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 84,000 and preferred dividends were $85,000. (Round earnings per share to the nearest cent.) Save your calculations and enter the requested amounts below. b. Prepare a retained earnings statement for the year ended December 31, 2012. Save your calculations and enter the requested amounts below. c. Prepare a balance sheet in report form as of December 31, 2012. Save your calculations and enter the requested amounts below. If required, only use the minus sign to indicate net loss before income tax, net loss, or a deficit balance in retained earnings. Gross profit $ Total Selling expenses $ Total Administrative expenses $ Total operating expenses $ Income from operations $ Net Other expenses and income $ Income tax $ Net income $ Earnings per common share (rounded to the nearest cent) $ Retained earnings, January 1, 2012 $ Total current assets $ Investment in Nordic Wear Inc. bonds $ Total property, plant, and equipment $ Total assets $ Total current liabilities $ Net Long-term liabilities $ Total liabilities $ Total Paid-in capital Preferred 5% stock $ Total Paid-in capital Common stock, $25 par $ Total paid-in capital $ Retained earnings, December 31, 2012 $ Total stockholders' equity $,A:the selecetions are 1.Cash, common stock, no entry, paides in capital excess of par-common stock or retained earings. I have enable the drop downs through active x. Let me know if you can see them.,Also the time has been extended to 6 pm,here are just the drop downs

 

Paper#7866 | Written in 18-Jul-2015

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