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Question: the stockholders equity accounts of novak corporation on january 1...

Question details

The stockholders’ equity accounts of Novak Corporation on January 1, 2020, were as follows.

Preferred Stock (8%, $52 par, 10,000 shares authorized) $  442,000
Common Stock ($1 stated value, 1,950,000 shares authorized) 1,350,000
Paid-in Capital in Excess of Par—Preferred Stock 115,000
Paid-in Capital in Excess of Stated Value—Common Stock 1,400,000
Retained Earnings 1,750,000
Treasury Stock (10,500 common shares) 52,500


During 2020, the corporation had the following transactions and events pertaining to its stockholders’ equity.

Feb. 1 Issued 26,000 shares of common stock for $122,000.
Apr. 14 Sold 5,700 shares of treasury stock—common for $32,700.
Sept. 3 Issued 5,100 shares of common stock for a patent valued at $36,000.
Nov. 10 Purchased 1,000 shares of common stock for the treasury at a cost of $6,000.
Dec. 31 Determined that net income for the year was $485,000.


No dividends were declared during the year.

Journalize the transactions and the closing entry for net income.

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