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Terrific Comfort Specialists, Inc., reported the following stockholders’ equity on its balance sheet at June

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Terrific Comfort Specialists, Inc., reported the following stockholders’ equity on its balance sheet at June 30, 2012:


TERRIFIC COMFORT SPECIALISTS, INC. 
Stockholders’ Equity
June 30, 2012
Paid-in Capital:
Preferred stock, 5%, ? par, 650,000 shares authorized, 280,000 shares issued
$ 1,400,000
Common stock, par value $1 per share, 5,000,000 shares authorized,
1,350,000 shares issued and outstanding
1,350,000
Paid in capital in excess of par—common
2,400,000
Total paid-in capital
5,150,000
Retained earnings
12,300,000
Total stockholders’ equity
$ 17,450,000

Requirements

Requirements

1. Identify the different issues of stock that Terrific has outstanding.

2. What is the par value per share of Terrific’s preferred stock?

3. Make two summary journal entries to record issuance of all the Terrific stock for
cash. Explanations are not required.

4. No preferred dividends are in arrears. Journalize the declaration of a $600,000
dividend at June 30, 2012. Use separate Dividends payable accounts for preferred
and common. An explanation is not required

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