Italian Stallion has the following transactions during the year related to stockholders' equity

February 1 Issues 5,900 shares of no-par common stock for $15 per share.
May 15 Issues 700 shares of $10 par value, 12% preferred stock for $12 per share.
October 1 Declares a cash dividend of $1.20 per share to all stockholders of record (both common and preferred) on October 15.
October 15 Date of record.
October 31 Pays the cash dividend declared on October 1.

Record each of these transactions.( omit account numbers and descriptions)

February 1

Dr. Cash                                                       $88,500

Cr. Add-in-capital excess of par common $88,500

May 15

Dr. Cash                                                         $8,400

Cr. Preferred Stock at par                            $7,000

Cr. Add-in-capital excess of par preferred $1,400

October 15

Dr. Dividend                $7,920

Cr. Dividend Payable $7,920

October 31

Dr. Dividend Payable $7,920

Cr. Cash                      $7,920

Explanation:

February 1

Cash received against issuance of stock

Proceeds = 5,900 x $15 = $88,500

As there is no par value we need to record in add-in-capital excess of par.

May 15

Preferred

Proceeds = 700 x $12 = $8,400

Par value = 7 00 x $10 = $7,000

Add-in-capital excess of par = 700 x ($12-$10) = $1,400

October 15

Dividend = $1.2 x (5,900+700) = $7,920

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