Prepare a journal entry Question 2 (13 marks - 20 minutes) On January 1,...
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Prepare a journal entry
Question 2 (13 marks - 20 minutes) On January 1, 20x7, Hobbes Inc. had 50,000 shares of common shares issued and outstanding. The book value of those shares was $800,000. Furthermore, they had 20,000 $4, non-cumulative, preferred shares issued and outstanding which had a book value of $300,000 The following transactions took place in 20x7: Jan 31 Issued 50,000 common shares for $500,000 Mar 1 Issued 20,000 common shares for $240,000 Apr 30 Repurchased and cancelled 20,000 shares at $11 each. June 30 A 2:1 stock split was announced Aug 15 Issued 50,000 common shares for land and a building. An independent appraisal indicated that the market value of the building was $100,000 and the land was $350,000 Dec 15 Declared a divided of $2.00/share to shareholders of record on Dec 31. Required Prepare all journal entries to record the above transactions. Round any units to two decimals
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