BUSINESS AND FINANCE

Brief Exercise 13-4

On June 1, Noonan Inc. issues 4,000 shares of no-par common stock at a cash price of $6 per share. Journalize the issuance of the shares assuming the stock has a stated value of $1 per share. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Cash = Issues shares x cash price = 4,000 x 6 = 24,000

Common Stock = Issues shares x stated value = 4,000 x 1 = 4,000

Paid-in Capital in Excess of Stated Value—Common Stock = 4,000 x 5(6-1) = 20,000

 

Account titles and explanation Debt Credit
Cash 24,000  
Common Stock   4,000
Paid-in Capital in Excess of Stated Value—Common Stock   20,000

 

Brief Exercise 13-7

Garb Inc. issues 5,000 shares of $100 par value preferred stock for cash at $130 per share. Journalize the issuance of the preferred stock. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Cash =5,000 x 130 = 650,000

Preferred stock =5,000 x 100 = 500,000

Paid-in Capital in Excess of Par—Preferred Stock =5,000 x 30(130-100) = 150,000

Account titles and explanation Debt Credit
Cash 650,000  
Common Stock   500,000
Paid-in Capital in Excess of Par-Preferred Stock   150,000

Brief Exercise 13-8

Pine Corporation has the following accounts at December 31: Common Stock, $10 par, 5,000 shares issued, $50,000; Paid-in Capital in Excess of Par—Common Stock $30,000; Retained Earnings $45,000; and Treasury Stock, 500 shares, $11,000.

 

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