Question

On May 23, Stoltz Realty Inc. issued for cash 128,000 shares of no-par common stock (with a stated value of $5) at $6. On July 6, Stoltz Realty Inc. issued at par value 41,000 shares of preferred 1% stock, $10 par for cash. On September 15, Stoltz Realty Inc. issued for cash 17,000 shares of preferred 1% stock, $10 par at $11.

Journalize the entries to record the May 23, July 6, and September 15 transactions. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS
Stoltz Realty Inc.
General Ledger
ASSETS 110 Cash 120 Accounts Receivable 131 Notes Receivable 132 Interest Receivable 141 Merchandise Inventory 145 Office Supplies 151 Prepaid Insurance 181 Land 193 Equipment 194 Accumulated Depreciation-Equipment LIABILITIES 210 Accounts Payable 221 Notes Payable 226 Interest Payable 231 Cash Dividends Payable 236 Stock Dividends Distributable 241 Salaries Payable 261 Mortgage Note Payable EQUITY 311 Common Stock 313 Paid-In Capital in Excess of Stated Value-Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331 Paid-In Capital in Excess of Par-Common Stock 340 Retained Earnings 351 Cash Dividends 352 Stock Dividends 390 Income Summary	REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 515 Credit Card Expense 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Selling Expenses 534 Rent Expense 535 Insurance Expense 536 Office Supplies Expense 537 Organizational Expenses 562 Depreciation Expense-Equipment 590 Miscellaneous Expense 710 Interest Expense

Journalize the entries to record the May 23, July 6, and September 15 transactions. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Solution

Date	Accounts title and explanation	Debit	credit
May-23	Cash	$      768,000.00
	Common stock		$     640,000.00
	Paid-In Capital in Excess of Stated Value-Common Stock		$     128,000.00
	(To record issuance of common stock)
Jul-06	Cash	$      410,000.00
	Preferred stock		$     410,000.00
	(To record issue of preferred stock)
Sep-15	Cash	$      187,000.00
	Preferred stock		$     170,000.00
	Paid-In Capital in Excess of Par-Preferred Stock		$       17,000.00
	(To record issue of preferred stock)

In absence of par value, stated value of taken as a par value.