Tugas Kelompok ke-3

(Minggu 8)

Case 1
The corporate charter of Gregory Corporation allows the issuance of a maximum of
2,500,000 ordinary shares with a $1 par value. During its first three years of operation,
Gregory issued 1,500,000 shares at $15 per share. It later acquired 30,000 treasury shares
for $25 per share.

Instructions

Based on the above information, answer the following questions:

(a) How many shares were authorized?

(b) How many shares were issued?

(c) How many shares are outstanding?

(d) What is the balance of the Share Capital–Ordinary account?

(e) What is the balance of the Treasury Shares account?

Case 2
Horner Corporation is authorized to issue 1,000,000 ordinary shares with a $5 par value.
During 2014, its first year of operation, the company has the following share transactions.

Jan. 1 Issued 500,000 ordinary shares at $7 per share.

Jan. 15 Paid the government $2,000 for incorporation fees.

Jan. 30 Attorneys for the company accepted 500 ordinary shares as payment for legal
services rendered in helping the company incorporate. The legal services are
estimated to have a value of $5,000.
July 2 Issued 100,000 shares for land. The land had an asking price of $900,000. The
stock is currently selling on a national exchange at $8 per share.
Sept. 5 Purchased 15,000 shares for the treasury at $10 per share.
Dec. 6 Sold 11,000 treasury shares at $11 per share.

Instructions
Journalize the transactions for Horner Corporation.

Case 3
The equity section of Linton Corporation at December 31 is as follows.

ACCT6174 – Introduction to Financial Accounting

 LINTON CORPORATION

Statement of Financial Position (partial)

Equity

Share capital–preference, cumulative, 10,000 shares authorized,

5,000 shares issued and outstanding $ 250,000

Share capital–ordinary, no par, 750,000 shares authorized,

150,000 shares issued 1,500,000

Retained earnings 2,050,000

Less: Treasury shares (5,000 ordinary shares) (64,000)

Total equity $3,736,000

Instructions

From a review of the equity section, answer the following questions.

(a) How many ordinary shares are outstanding?

(b) Assuming there is a stated value, what is the stated value of the ordinary shares?

(c) What is the par value of the preference shares?

(d) If the annual dividend on preference shares is $10,000, what is the dividend rate on
preference shares?

(e) If dividends of $36,000 were in arrears on preference shares, what would be the
balance in Retained Earnings?

Case 4
Yunger Corporation has the following equity accounts on January 1, 2014:

Share Capital–Ordinary, $10 par value ......................................... $1,500,000

Share Premium–Ordinary.............................................................. 200,000

Retained Earnings.......................................................................... 500,000

Total Equity............................................................................. $2,200,000

ACCT6174 – Introduction to Financial Accounting

The company uses the cost method to account for treasury share transactions. During 2014,
the following treasury share transactions occurred:

April 1 Purchased 9,000 shares at $16 per share.

August 1 Sold 3,000 shares at $18 per share.

October 1 Sold 3,000 shares at $15 per share.

Instructions

(a) Journalize the treasury share transactions for 2014.

(b) Prepare the Equity section of the statement of financial position for Yunger
Corporation at December 31, 2014. Assume net income was $110,000 for 2014.

Case 5
The following equity accounts (in 000), arranged alphabetically, are in the ledger of Zhang
Corporation at December 31, 2014.

Retained Earnings ¥1,334,000

Share Capital–Ordinary (¥5 stated value) 2,200,000
Share Capital–Preference (8%, ¥100 par, noncumulative) ¥ 500,000
Share Premium–Preference 290,000
Share Premium—Ordinary 800,000
Treasury Shares (10,000 shares) 110,000

Instructions
Prepare the equity section of the statement of financial position at December 31, 2014.

ACCT6174 – Introduction to Financial Accounting