Question

P13-1B Joanjim Corporation was organized on January 1, 2012. It is authorized to issue 20,000 shares of 6%, 340 par value preferred stock, and 500,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year. Jan. 10 Issued 100,000 shares of common stock for cash at $3 per share. Mar. issued 10,000 shares of preferred stock for cash at $55 per share. Apr. 1 May Issued 25,000 shares of common stock for land. The asking price of the land was $90,000. The company's estimate of fair value of the land was $75,000. Issued 75.000 shares of common stock for cash at $4 per share. Aug. Issued 10,000 shares of common stock to attorneys in payment of their bill for $50,000 for services provided in helping the company organize. Issued 5,000 shares of common stock for cash at $6 per share. Sept. Nov. Issued 2,000 shares of preferred stock for cash at $60 per share. Instructions (a) Joumalize the transactions. (b) Post to the stockholders' equity accounts. (Use Jl as the posting reference.) (c) Prepare the paid-in capital section of stockholders' equity at December 31, 2012 P13-2B

Answer 1

Date	Account title	Debit	Credit
Jan. 10	Cash	300,000
	Common stock		200,000
	Paid in capital in excess of stated value-Common stock		100,000
Mar. 1	Cash	550,000
	Preferred stock		400,000
	Paid in capital in excess of par value-Preferred stock		150,000
Apr. 1	Land	75,000
	Common stock		50,000
	Paid in capital in excess of stated value-Common stock		25,000
May. 1	Cash	300,000
	Common stock		150,000
	Paid in capital in excess of stated value-Common stock		150,000
Aug. 1	Organization expense	50,000
	Common stock		20,000
	Paid in capital in excess of stated value-Common stock		30,000
Sept. 1	Cash	30,000
	Common stock		10,000
	Paid in capital in excess of stated value-Common stock		20,000
Nov. 1	Cash	120,000
	Preferred stock		80,000
	Paid in capital in excess of par value-Preferred stock		40,000

Preferred stock
Particulars	Debit	Particulars	Credit
		Mar. 1	400,000
		Nov. 1	80,000
		Dec. 31. Bal.	480,000
Common stock
Particulars	Debit	Particulars	Credit
		Jan. 10	200,000
		Apr. 1	50,000
		May. 1	150,000
		Aug. 1	20,000
		Sept. 1	10,000
		Dec. 31. Bal.	430,000
Paid in capital in excess of par-Preferred stock
Particulars	Debit	Particulars	Credit
		Mar. 1	150,000
		Nov. 1	40,000
		Dec. 31. Bal.	190,000
Paid in capital in excess of stated-Common stock
Particulars	Debit	Particulars	Credit
		Jan. 10	100,000
		Apr. 1	25,000
		May. 1	150,000
		Aug. 1	30,000
		Sept. 1	20,000
		Dec. 31. Bal.	325,000

Joanjim Corporation
Partial Balance Sheet
For the Year Ended December 31, 2012
Stockholders' equity
Paid in capital:
Capital stock:
Preferred stock	480,000
Common stock	430,000	910,000
Additional paid in capital:
Paid in Capital in excess of stated value -Common Stock	190,000
Paid in Capital in excess of Par-Preferred Stock	325,000	515,000
Total paid in capital		1,425,000