20. The accumulated surplus of a corporation capitalized at $1,000,000.00, with a paid up capital of $600,000.00, is $110,000.00; the current profits are $100,000.00. The directors declare a cash dividend of 7%, and a stock dividend of 25%. Make all entries to record these transactions on the general books of the corporation.
21. The following statistics are taken from the books of a corporation:
| Capital Stock | $300,000.00 |
| Merchandise Inventory | 97,600.00 |
| Machinery | 110,800.00 |
| Undivided Profits | 600.00 |
| Profit and Loss (Credit) | 31,210.00 |
It is desired to set aside a special surplus fund as a machinery depreciation reserve, the depreciation being figured at 10% a year, and to pay a dividend of 6%. What entries are necessary?
22. Parsons, Young, and Searles are partners and decide to form a corporation with capital stock of $40,000.00, which is to be issued as full paid stock in exchange for their present business. Each partner is to receive stock in proportion to his interest in the present business. The balance sheet of the partnership is as follows:
| ASSETS | ||
| Cash | $3,500.00 | |
| Bills Receivable | 6,000.00 | |
| Accounts Receivable | 6,500.00 | |
| Merchandise | 14,000.00 | |
| ————— | ||
| Total | $30,000.00 | |
| LIABILITIES | ||
| Bills Payable | 4,000.00 | |
| Accounts Payable | 2,000.00 | |
| Parsons | 10,000.00 | |
| Young | 8,000.00 | |
| Searles | 6,000.00 | |
| ————— | ||
| Total | 30,000.00 | |
Make entries on books of the partnership.
Make entries on books of the corporation.
23. Hoadley and Stockton are partners and desire to incorporate a company. The stock is to be divided equally between Hoadley and Stockton after giving Hopper $1,000.00. The balance sheet of the partnership is as follows: