“Stock Repurchase”Discuss the signal a large stock repurchase might foretell about management’s outlook relative to the future of a company. Explain whether a repurchase of stock is typically a good or bad sign. Provide a rationale for your response.Brief Exercise 13-04On June 1, Martinez Inc. issues 3,000 shares of no-par common stock at a cash price of $5 per share.Journalize the issuance of the shares assuming the stock has a stated value of $2 per share. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
DateAccount Titles and ExplanationDebitCreditJune 1Brief Exercise 13-06Flounder Inc. issues 4,350 shares of $115 par value preferred stock for cash at $135 per share.Journalize the issuance of the preferred stock. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)Account Titles and ExplanationDebitCreditBrief Exercise 13-08Blue Spruce Corporation has the following accounts at December 31: Common Stock, $8 par, 5,550 shares issued, $44,400; Paid-in Capital in Excess of Par—Common Stock $33,100; Retained Earnings $46,000; and Treasury Stock, 500 shares, $10,500.Prepare the stockholders’ equity section of the balance sheet. (Enter the account name only and do not provide the descriptive information provided in the question.)BLUE SPRUCE CORPORATIONBalance Sheet (Partial)$: $Exercise 13-02Andrea has prepared the following list of statements about corporations.Identify each statement as true or false.1.Corporation management is both an advantage and a disadvantage of a corporation compared to a proprietorship or a partnership.2.Limited liability of stockholders, government regulations, and additional taxes are the major disadvantages of a corporation.3.When a corporation is formed, organization costs are recorded as an asset.4.Each share of common stock gives the stockholder the ownership rights to vote at stockholder meetings, share in corporate earnings, keep the same percentage ownership when new shares of stock are issued, and share in assets upon liquidation.5.The number of issued shares is always greater than or equal to the number of authorized shares.6.A journal entry is required for the authorization of capital stock.7.Publicly held corporations usually issue stock directly to investors.8.The trading of capital stock on a securities exchange involves the transfer of already issued shares from an existing stockholder to another investor.9.The market price of common stock is usually the same as its par value.10.Retained earnings is the total amount of cash and other assets paid in to the corporation by stockholders in exchange for capital stock.Exercise 13-04 a-eCulver Corporation issued 4,300 shares of stock.Prepare the entry for the issuance under the following assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,650.)(a)The stock had a par value of $10 per share and was issued for a total of $46,000.(b)The stock had a stated value of $10 per share and was issued for a total of $46,000.(c)The stock had no par or stated value and was issued for a total of $46,000.(d)The stock had a par value of $10 per share and was issued to attorneys for services during incorporation valued at $46,000.(e)The stock had a par value of $10 per share and was issued for land worth $46,000.
No.Account Titles and ExplanationDebitCredit(a)(b)(c)(d)(e)Exercise 13-07 a-b (Part Level Submission)On January 1, 2020, the stockholders’ equity section of Culver Corporation shows common stock ($5 par value) $1,500,000; paid-in capital in excess of par $1,000,000; and retained earnings $1,160,000. During the year, the following treasury stock transactions occurred.Mar.1Purchased 47,000 shares for cash at $15 per share.July1Sold 10,500 treasury shares for cash at $17 per share.Sept. 1Sold 9,000 treasury shares for cash at $14 per share.(a)Journalize the treasury stock transactions. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually.)DateAccount Titles and ExplanationDebitCredit(b)Restate the entry for September 1, assuming the treasury shares were sold at $12 per share. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)DateAccount Titles and ExplanationDebitCreditProblem 13-01A a-c (Part Level Submission)Swifty Corporation was organized on January 1, 2020. It is authorized to issue 15,000 shares of 8%, $100 par value preferred stock, and 456,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year.Jan.10Issued 79,000 shares of common stock for cash at $4 per share.Mar.1Issued 5,000 shares of preferred stock for cash at $110 per share.Apr.1Issued 23,500 shares of common stock for land. The asking price of the land was $94,500. The fair value of the land was $87,500.May1Issued 77,500 shares of common stock for cash at $5.25 per share.Aug.1Issued 11,000 shares of common stock to attorneys in payment of their bill of $45,000 for services performed in helping the company organize.Sept.1Issued 11,000 shares of common stock for cash at $5 per share.Nov.1Issued 2,000 shares of preferred stock for cash at $113 per share.(a)Journalize the transactions. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually.)DateAccount Titles and ExplanationDebitCredit(b)Post to the stockholders’ equity accounts. (Post entries in the order of journal entries presented in the previous part.)Preferred StockCommon StockPaid-in Capital in Excess of Par-Preferred StockPaid-in Capital in Excess of Stated Value-Common Stock(c)Prepare the paid-in capital section of stockholders’ equity at December 31, 2020. (Enter the account name only and do not provide the descriptive information provided in the question.)SWIFTY CORPORATIONBalance Sheet (Partial)$$$
