Question

# Brief Exercise 15-4 Wildhorse Corporation issued 311 shares of \$10 par value common stock and 112...

Brief Exercise 15-4 Wildhorse Corporation issued 311 shares of \$10 par value common stock and 112 shares of \$50 par value preferred stock for a lump sum of \$15,678. The common stock has a market price of \$20 per share, and the preferred stock has a market price of \$100 per share. Prepare the journal entry to record the issuance. (Round intermediate calculations to 6 decimal places, e.g. 0.546872 and final answers to 0 decimal places, e.g., 1,520. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation

Solution:

 Shares Issued Market price per share Total Market Value of Shares Proportion of Market Values Issue Price Allocated Common Stock 311 \$20 \$6,220 0.357061 \$5,598 Preferred Stock 112 \$100 \$11,200 0.642939 \$10,080 Total \$17,420 1.000000 \$15,678
 No. Accounts Title and explanation Debit Credit 1 Cash Dr \$5,598 To Common Stock (311*\$10) \$3,110 To Paid in capital in excess of Par - Common Stock \$2,488 (To record issue of Common Stock) 2 Cash Dr \$10,080 To Preferred Stock (112*\$50) \$5,600 To Paid in capital in excess of Par - Common Stock \$4,480 (To record issue of Preferred Stock)