Question

King Mart Corporation began operations on May 1, 2019, and authorized the issuance of 200,000 shares of $5 par value common stock and 10,000 shares of $100 par value, 10% cumulative preferred stock.

Where necessary prepare the journal entries to record the following transactions

May 2: Issued 1,000 shares of common stock at par to the promoters/lawyers for their services;

May 3: Issued 50,000 shares of common stock for $12 cash per share

May 4: Issued 10,000 shares of common stock at par for cash

May 5: Declared a cash dividend payable to all stockholders of $61,000

May 10: Date of record is May 10 for the cash dividend declared on May 5^th.

May 15: Paid the cash dividend declared on May 5.

Answer 1

Journal entries

Date	General Journal	Debit	Credit
May 2	Organization expense (1000*5)	5000
	Common Stock		5000
May 3	Cash (50000*12)	600000
	Common Stock		250000
	Paid in capital in excess of par-Common Stock		350000
May 4	Cash	50000
	Common Stock		50000
May 5	Cash dividend	61000
	dividend payable		61000
May 10	No Journal entry
May 15	Dividend payable	61000
	Cash		61000