Military Stores is authorized to issue 12,000 shares of common stock. During a t
ID: 2579713 • Letter: M
Question
Military Stores is authorized to issue 12,000 shares of common stock. During a two-month period, Military completed these stock-issuance transactions: May July 23 Issued 2,500 shares of $1.00 par common stock for cash of $14.50 per share. 12 Received inventory with a market value of $15,000 and equipment with market value of $46,000 for 3,700 shares of the $1.00 par common stock Requirements 1. Journalize the transactions. 2. Prepare the stockholders' equity section of Military Stores' balance sheet for the transactions given in this exercise. Retained Earnings has a balance of $49,000.Explanation / Answer
1. Journalize the transaction :
2) Stockholder' equity :
Date accounts & explanation debit credit May 23 Cash a/c 36250 Common stock a/c 2500 Paid in capital in excess of par value-common stock 33750 (To record issuance of common stock) July 12 Inventory a/c 15000 Equipment a/c 46000 Common stock a/c 3700 Paid in capital in excess of par value-common stock 57300 (To record exchange of common stock )