Question

On October 31, Legacy Rocks Inc., a marble contractor, issued for cash 72,900 shares of $10 par common stock at $14, and on November 19, it issued for cash 20,640 shares of preferred stock, $50 par at $52.

Required:

A.	Journalize the entries for October 31 and November 19. Refer to the Chart of Accounts for exact wording of account titles.
B.	What is the total amount invested (total paid-in capital) by all stockholders as of November 19?

Answer 1

Journal entries:
Date	Accounts title and explanations				Debit $	Credit $
31-Oct	Cash account				1020600
	Common Stock capital (72900*10)					729000
	Additional Paid in capital-Common (72900*4)					291600
19-Nov	Cash account				1073280
	Preferred Stock capital (20640*50)					1032000
	Additional paid in capital-Prefereed (20640*2)					41280
Stockholder's Investment:
Common Sstock capital				729000
Preferred Sstock capital				1032000
Additional paid in capital-Common				291600
Additional Paid in capital-Preferred				41280
Total Amount invested				2093880