prepare the stockholders rsquo equity section at december 31 2014 618677

Kingsley Corporation has been authorized to issue 40,000 shares of $100 par value, 8%, noncumulative preferred stock and 2,000,000 shares of no-par common stock. The corporation assigned a $5 stated value to the common stock. At December 31, 2014, the ledger contained the following balances pertaining to stockholders’ equity.

Preferred Stock

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$ 240,000

Paid-in Capital in Excess of Par—Preferred Stock

56,000

Common Stock

2,000,000

Paid-in Capital in Excess of Stated Value—Common Stock

4,400,000

Treasury Stock (1,000 common shares)

22,000

Paid-in Capital from Treasury Stock

3,000

Retained Earnings

560,000

The preferred stock was issued for land having a fair value of $296,000. All common stock issued was for cash. In November, 1,500 shares of common stock were purchased for the treasury at a per share cost of $22. In December, 500 shares of treasury stock were sold for $28 per share. No dividends were declared in 2014.

Instructions

(a)Prepare the journal entries for the:

(1)Issuance of preferred stock for land.

(2)Issuance of common stock for cash.

(3)Purchase of common treasury stock for cash.

(4)Sale of treasury stock for cash.

(b)Prepare the stockholders’ equity section at December 31, 2014.

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