Prepare journal entries to record the following four separate issuances of stock
ID: 2590812 • Letter: P
Question
Prepare journal entries to record the following four separate issuances of stock. 1. A corporation issued 5,000 shares of $20 par value common stock for $120,000 cash. 2. A corporation issued 2,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $25,500. The stock has a $1 per share stated value 3. A corporation issued 2,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $25.500. The stock has no stated value 4.A corporation issued 1,250 shares of $100 par value preferred stock for $150,500 cash. View transaction list Journal entry worksheet Record the issue of 5,000 shares of $20 par value common stock for $120,000 cash. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journalExplanation / Answer
Answer
S. No.
Particulars
Dr. Amt.
Cr. Amt.
1
Bank
120,000
Common Stock(5000*20)
100,000
Additional Paid in capital
20,000
(Being 5000 shares issued for cash)
2
Preliminary expenses
25,500
Common Stock(2500*1)
2500
Additional Paid in capital
23,000
(Being 2500 shares with Stated value 1 issued to promoters)
3
Preliminary expenses
25,500
Common Stock(No par value)
25,500
(Being 2500 shares with no par value issued to promoters)
4
Bank
150,500
Preference Stock(1,250*100)
125,000
Additional Paid in capital
25,500
(Being 1250 preference shares issued for cash)
S. No.
Particulars
Dr. Amt.
Cr. Amt.
1
Bank
120,000
Common Stock(5000*20)
100,000
Additional Paid in capital
20,000
(Being 5000 shares issued for cash)
2
Preliminary expenses
25,500
Common Stock(2500*1)
2500
Additional Paid in capital
23,000
(Being 2500 shares with Stated value 1 issued to promoters)
3
Preliminary expenses
25,500
Common Stock(No par value)
25,500
(Being 2500 shares with no par value issued to promoters)
4
Bank
150,500
Preference Stock(1,250*100)
125,000
Additional Paid in capital
25,500
(Being 1250 preference shares issued for cash)