Question

Ergonomics Supply Inc., a wholesaler of office products, was organized on July 1 of the current year, with an authorization of 25,000 shares of preferred 2% stock, $100 par, and 500,000 shares of $10 par common stock. The following selected transactions were completed during the first year of operations: July 1. Issued 220,000 shares of common stock at par for cash. 1. Issued 700 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation. Aug. 7. Issued 68,700 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $153,800, $458,110 and $164,400 respectively. Sept. 20. Issued 18,200 shares of preferred stock at $115 for cash. Required: Journalize the transactions. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

Answer 1

Date	Description	Debit	Credit	Assets	Liabilities	Equity
July 1	Cash	2200000		↑
	Common Stock		2200000			↑
July 1	Organizational expense	7000				↓
	Common Stock		7000			↑
Aug. 7	Land	153800		↑
	Buildings	458110		↑
	Equipment	164400		↑
	Common Stock		687000			↑
	Paid in capital in excess of par-Common Stock		89310			↑
Sept. 20	Cash	2093000		↑
	Preferred Stock		1820000			↑
	Paid in capital in excess of par-Preferred Stock		273000			↑