Question

Prepare the journal entries to record the following separate issuances of stock:

1.) A corporation issued 10,000 shares of $6 par value common stock for $70,000.

2.) A corporation issues 3,000 shares of $20 par value preferred stock for $75,000.

3.) A corporation issued 5,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $200,000. The stock has a $15 stated value.

4.) A corporation issued 2,500 shares of no-par common stock in exchange for a building worth $30,000.

Answer 1

Journal entries

No	General Journal	Debit	Credit
1	Cash	70000
	Common Stock (10000*6)		60000
	Paid in capital in excess of par-Common		10000
2	Cash	75000
	Preferred stock (3000*20)		60000
	Paid in capital in excess of par-Preferred		15000
3	Organization expense	200000
	Common Stock (5000*15)		75000
	paid in capital in excess of stated-Common		125000
4	Building	30000
	Common Stock		30000