Question

(Prepare journal entries to record the following four separate issuances of stock.)

A corporation issued 4,000 shares of $10 par value common stock for $48,000 cash.

A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $47,500. The stock has a $2 per share stated value.

A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $47,500. The stock has no stated value.

A corporation issued 1,000 shares of $75 par value preferred stock for $122,500 cash.

Answer 1

Journal entry :

Date	accounts & explanation	debit	credit
	Cash	48000
	Common stock		40000
	Paid in capital from excess of par value-common stock		8000
	(To record issue common stock)
	Organisation fees	47500
	Common stock		4000
	Paid in capital in excess of stated value-common stock		43500
	(To record issue common stock)
	Cash	47500
	Common stock		47500
	(To record issue common stock)
	Cash	122500
	Preferred stock		75000
	Paid in capital in excess of par value-Preferred stock		47500
	(To record issue preferred stock)