Newly formed s& Iron Corporation has 50,000 shares of $10 par common stock autho
ID: 2590958 • Letter: N
Question
Newly formed s& Iron Corporation has 50,000 shares of $10 par common stock authorined. On March 1, 2016, s8u Iron issued 6,000 shares of the stock for $16 per share. On May 2 the company ssued an additional 10,000 shares for $18 per share. S&l; Iron wes not affected by other events during 2016 A. Record the trensactions in a horizontal statements model. In the Cash Flow column, indicate whether the item is an Use NA to indicate that an element was not affected by the event operating activity (OA) nvesting activity (IAl, or financing actity (FA) s. Determine the amount S&u; lron would report for common stock on the December 31, 2016, balance sheet c Determine the amount s& Iron would report for paid-in capital in ses.ot par D What is the total amount of capital contributed by the owners? what amount of total assets would iron report on the December 31, 2016, balance sheet? F. Prepare journal entries to record the March 1 and May 2 transactions (If no entry i is required for a transaction/event, select "No journal entry required" in the first account field,)Explanation / Answer
Answer a. Date Assets = Liabilities + Stockholders' Equity Cash Flow Statement 1-Mar Cash 96,000 = NA Common Stock 60,000 Issue of Common Stock 96,000 FA Paid-in Capital in Excess of Par 36,000 2-May Cash 180,000 NA Common Stock 100,000 Issue of Common Stock 180,000 FA Paid-in Capital in Excess of Par 80,000 Answer b. Common Stock - Dec 31, 2016 160,000 (16,000 Shares X $10) Answer c. Paid-in Capital in Excess of Par - Dec 31, 2016 116,000 Answer d. Capital Contributed by Owners 276,000 Answer e. Total Assets - Dec 31, 2016 276,000 Answer f. Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1-Mar Cash Dr. 96,000 To Common Stock 60,000 To Paid-in Capital in Excess of Par 36,000 (Record the issue of Common Stock) 2-May Cash Dr. 180,000 To Common Stock 100,000 To Paid-in Capital in Excess of Par 80,000 (Record the issue of Common Stock)