Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Exercise 81

Transaction analysis—various accounts Enter the following column headings across the top of a sheet of paper:

		Other		Paid-In	Retained	Treasury	Net
Transaction	Cash	Assets	Liabilities	Capital	Earnings	Stock	Income

Enter the transaction letter in the first column and show the effect (if any) of each of the following transactions on each financial statement category by entering a plus (+) or minus (-) sign and the amount in the appropriate column. Do not show items that affect net income in the retained earnings column. You may also write the entries to record each transaction.

a. Sold 4,100 shares of $50 par value 9% preferred stock at par.

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b. Declared the annual dividend on the preferred stock.

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c. Purchased 650 shares of preferred stock for the treasury at $54 per share.

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d. Issued 2,000 shares of $1 par value common stock in exchange for land valued at $113,000.

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e. Sold 300 shares of the treasury stock purchased in transaction c for $58 per share.

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f. Split the common stock 2 for 1.

Step 1 of 2

Transaction analysis:

The presentation of given transactions using proper prescribed headings is as follows :