Select your language

Suggested languages for you:
Log In Start studying!
Answers without the blur. Just sign up for free and you're in → Illustration

Q21E_1

Expert-verified
Horngren'S Financial And Managerial Accounting
Found in: Page 712

Short Answer

Journalizing issuance of stock

Steller Systems completed the following stock issuance transactions:

May 19 Issued 1,700 shares of $3 par value common stock for cash of $10.50 per share.

Jun. 3 Issued 300 shares of $9, no-par preferred stock for $15,000 cash.

11 Received equipment with a market value of $68,000 in exchange for 5,000 shares of the $3 par value common stock.

Requirements

1. Journalize the transactions. Explanations are not required.

Issued 1,700 shares on premium of $7.5, 300 shares for $15,000, and 5,000 shares in exchange of $68,000 equipment on premium of $53,000.

See the step by step solution

Step by Step Solution

Step 1: Basic Introduction-

Market value is the current price of an asset in the marketplace. Market value also alludes to the market capitalization of a publicly traded corporation.

Step 2: Journals

Date

Transaction

Debit

Credit

May 19

Cash (1,700 * $10.50)

$17,850

Common stock (1,700 * $3)

$5,100

Paid-in capital in excess of par

$12,750

Jun 3

Cash

$15,000

Preferred stock

$15,000

Jun 11

Equipment

$68,000

Common stock

$15,000

Paid-in capital in excess of par

$53,000

Most popular questions for Business-studies Textbooks

Icon

Want to see more solutions like these?

Sign up for free to discover our expert answers
Get Started - It’s free

Recommended explanations on Business-studies Textbooks

94% of StudySmarter users get better grades.

Sign up for free
94% of StudySmarter users get better grades.