Jan. 3 Issued 15,000 shares of $20 par common stock at $30, receiving cash.

Feb. 15 Issued 4,000 shares of $80 par preferred 5% stock at $100, receiving cash.
May 1 Issued $500,000 of 10-year, 5% bonds at 104, with interest payable
semiannually.
16 Declared a quarterly dividend of $0.50 per share on common stock and $1.00
per share on preferred stock. On the date of record, 100,000 shares of common
stock were outstanding, no treasury shares were held, and 20,000 shares of
preferred stock were outstanding.
26 Paid the cash dividends declared on May 16.
Jun. 8 Purchased 8,000 shares of treasury common stock at $33 per share.
30 Declared a $1.00 quarterly cash dividend per share on preferred stock. On the
date of record, 20,000 shares of preferred stock had been issued.
Jul. 11 Paid the cash dividends to the preferred stockholders.
Record on journal page 11:
Oct. 7 Sold, at $38 per share, 2,600 shares of treasury common stock purchased on Jun.
8.
31 Recorded the payment of semiannual interest on the bonds issued on May 1 and
the amortization of the premium for six months. The amortization is determined
using the straight-line method.
Required:
1. Journalize the selected transactions. Refer to the Chart of Accounts for exact wording of
account titles. Note: on May 16 record the declaration of dividends for common shares
and the declaration of dividends for preferred shares as two separate entries.

Note: You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B).

Required:
1. After all of the transactions for the year ended December
31, 20Y8, had been posted [including the transactions
recorded in part (1) and all adjusting entries], the data
that follow were taken from the records of Equinox
Products Inc.
a. Prepare a multiple-step income statement for the year
ended December 31, 20Y8. Enter all amounts as
positive numbers EXCEPT in the Other revenue and
 Required:
expense section. In that section only, enter amounts that
represent other expenses as negative numbers using a
minus sign.
b. Prepare a retained earnings statement for the year
ended December 31, 20Y8.*
c. Prepare a balance sheet in report form as of
December 31, 20Y8. *
* Read the instructions above each financial
statement carefully. They may contain specific
instructions for completing the statement.
Income Statement data:
Advertising expense $ 150,000
Cost of goods sold 3,700,000
Delivery expense 30,000
Depreciation expense- 30,000
office buildings and equipment
Depreciation expense- 100,000
store buildings and equipment
Income tax expense 140,500
Interest expense 21,000
Interest revenue 30,000
Miscellaneous administrative 7,500
expense
Miscellaneous selling expense 14,000
Office rent expense 50,000
Office salaries expense 170,000
Office supplies expense 10,000
Sales 5,313,000
Sales commissions 185,000
Sales salaries expense 385,000
Store supplies expense 21,000
Retained earnings and balance sheet data:
Accounts payable $ 194,300
Accounts receivable 545,000
Accumulated depreciation—office buildings and equipment 1,580,000
Accumulated depreciation—store buildings and equipment 4,126,000
Allowance for doubtful accounts 8,450
Bonds payable, 5%, due in 10 years 500,000
Cash 282,850
Common stock, $20 par
(400,000 shares authorized; 100,000 shares issued, 94,600 outstanding) 2,000,000
Dividends:
Cash dividends for common stock 155,120
Cash dividends for preferred stock 100,000
Goodwill 700,000
Income tax payable 44,000
Interest receivable 1,200
Inventory (December 31, 20Y8),
at lower of cost (FIFO) or market 778,000
Office buildings and equipment 4,320,000
Paid-in capital from sale of treasury stock 13,000
Excess of issue price over par:
-Common 886,800
-Preferred 150,000
Preferred 5% stock, $80 par
(30,000 shares authorized; 20,000 shares issued) 1,600,000
Premium on bonds payable 19,000
Prepaid expenses 27,400
Retained earnings, January 1, 20Y8 8,197,220
Store buildings and equipment 12,560,000
Treasury stock
(5,400 shares of common stock at cost of $33 per share) 178,200