Scribd
Upload
59 views2 pages

Q1. Patson Corp: Journal Entries

Patson Corp recorded several journal entries related to treasury stock and dividends: 1) It purchased 20,000 shares of treasury stock for K240,000 cash. 2) It declared a K1.50 dividend per share on 100,000 outstanding shares, paying K120,000 from retained earnings. 3) It sold 12,000 shares of treasury stock for K156,000, allocating K12,000 to treasury stock and K144,000 to paid-in capital. 4) It sold 8,000 shares of treasury stock for K76,000, allocating K8,000 to treasury stock and K68,000 to paid-in capital

Uploaded by

Prince-SimonJohnMwanza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
59 views2 pages

Q1. Patson Corp: Journal Entries

Patson Corp recorded several journal entries related to treasury stock and dividends: 1) It purchased 20,000 shares of treasury stock for K240,000 cash. 2) It declared a K1.50 dividend per share on 100,000 outstanding shares, paying K120,000 from retained earnings. 3) It sold 12,000 shares of treasury stock for K156,000, allocating K12,000 to treasury stock and K144,000 to paid-in capital. 4) It sold 8,000 shares of treasury stock for K76,000, allocating K8,000 to treasury stock and K68,000 to paid-in capital

Uploaded by

Prince-SimonJohnMwanza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

Q1.

Patson Corp
JOURNAL ENTRIES
Date Deatails Debit Credit
10-Jan-12 Treasury Stock, Common (20,000 shares * K12) 240,000
Cash 240,000

2-Mar-12 Retained Earnings (100,000 shares - 20,000 shares = 80,000 * K1.50) 120,000
Common dividend Payable 120,000

31-Mar-12 Common dividend Payable 120,000


Cash 120,000

11-Nov-12 Cash (12000 shares * K13) 156,000


Treasury Stock, Common 12,000
Paid-in Capital 144,000

25-Nov-12 Cash (8,000 shares * K9.5) 76,000


Treasury Stock, Common 8,000
Paid-in Capital 68,000

1-Dec-12 Retained Earnings (100,000 shares * K2.50) 250,000


Common dividend Payable 250,000

WORKINGS

W1. 20,000 shares * K12 = K240,000

W2. 100,000 shares - 20,000 shares = 80,000 shares * K1.50 = K120,000

W3. 12000 shares * K13 = K156,000

W4. 8,000 shares * K9.5 = K76,000


Q2. Danda
Annuity Factor Interest Rate
Principal Amount 4 periods at 7% Payment 7%
ZMW 25,000 3.3872 ZMW 7,381

Amortisation Table
Year Beginning Payment Interest Principal Ending
Balance Amount Expense Payment Balance
1 ZMW 25,000 ZMW 7,381 ZMW 1,750 ZMW 5,631 ZMW 19,369
2 ZMW 19,369 ZMW 7,381 ZMW 1,356 ZMW 6,025 ZMW 13,344
3 ZMW 13,344 ZMW 7,381 ZMW 934 ZMW 6,447 ZMW 6,898
4 ZMW 6,898 ZMW 7,381 ZMW 483 ZMW 6,898 ZMW 0

You might also like