Sheridan Corporation was organized on January 1, 2019. During its first year, the corporation issued 1,950 shares of $50 par value preferred stock and 110,000 shares of $10 par value common stock. At December 31, the company declared the following cash dividends:

2019, $6,325;

2020, $13,900; and 2021, $28,500.

Required:

a. Journalize the above transactions of Sheridan Corporation.

Question

Business

Piper Galvan

12 November, 06:14

Sheridan Corporation was organized on January 1, 2019. During its first year, the corporation issued 1,950 shares of $50 par value preferred stock and 110,000 shares of $10 par value common stock. At December 31, the company declared the following cash dividends:

2019, $6,325;

2020, $13,900; and 2021, $28,500.

Required:

a. Journalize the above transactions of Sheridan Corporation.

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Answers (1)

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Lilia Garcia · Answer 1

cash 97,500 debit

preferred stock 97,500 credit

cash 1,100,000 debit

common stock 1,100,000 credit

dividends 6,325 debit

cash 6,325 credit

dividends 13,900 debit

cash 13,900 credit

dividends 28,500 debit

cash 28,500 credit

Explanation:

raised from each type of share:

preferred

1,950 x $50 = $ 97,500

common

110,000 x $10 = $ 1,100,000

Then to record we debit the cash raised and credit the corresponding type o share

for dividends we will debit the dividends account and credit cash as the dividends are a cahs outflow.