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Q2TI

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Horngren'S Financial And Managerial Accounting
Found in: Page 680

Short Answer

London Corporation has two classes of stock: Common, $1 par value; and Preferred, $4 par value. Journalize the issuance of 10,000 shares of common stock for $8 per share.

Cash debited by $80,000 and Common stock credited by $80,000.

See the step by step solution

Step by Step Solution

Step 1: Basic Introduction-

Common stock represents ownership in a corporate organisation. Common stockholders elect the board of directors and vote on policies related to corporation.

Step 2: Journals-

Date

Transaction

Debit

Credit

Cash (10,000 * $8)

$80,000

Common stock

$80,000

To record issuance of common stock

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