Stockholders Equity: Transaction Descriptions from Account Data The following T-

Question

Stockholders Equity: Transaction Descriptions from Account Data The following T-accounts contain keyed entries representing five transactions involving the stockholders' equity of Riverview, Inc: otein Capi Cash Paid-in Capital in Excess of Par Value-Preferred Stock Paid-in Capital from Trensury St 600 60,000 600 (5 (1) 75,000 15,600 (4) (2) 100000 (5) 8,400 Treasury Stock Common Stock, $20 Par 100,000 (2) 80,000 (3) (4) 15,600 7,800 (5) Land (3) 95,000 aid-in Captial in Excess of Par Value- Common Stock Preferred Stock, $10 Par 15,000(3) 15,000 (1) *600 shares of common stock Using this information, give detailed descriptions, including number of shares and price per share when applicable, for each of the five transactions

Explanation / Answer

Particulars Debit ( $ ) Credit ( $ ) 1. Cash A/c Dr 75000 To Preferred Stock A/c 15000 To Share Premium A/c 60000 ( Being Shares issued) Issued 15000/5= 1500 Shares Issue price 75000/1500= 50 $ per share 2.Cash A/c dr 100000 To common stock A/c 100000 ( Being Shares issued) issued 100000/20 = 5000 stock 3. Land A/c Dr 95000 To Common Stock A/c 80000 To Share Premium A/c 15000 ( Being stock purchased with the consideration of Land) Issued 80000/20 = 4000 shares 4. Treasury stock A/c Dr 15600 To Cash A/c 15600 ( Being treasury Stock made ) 15600/600 = 26 per share 5. Cash A/c Dr 8400 To Treasury stock A/c 7800 To Paid in Capital from treasury stock A/c 600 ( Being Treasury stock sold) 7800/26 = 300 shares

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