Question

Accurate Builders construction company was incorporated by John Davis. Assume the following activities occurred during the year: a. Received from three investors $63,000 cash and land valued at $38,000; each investor was issued 2,500 shares of common stock with a par value of $0.10 per share. b. Purchased construction equipment for use in the business at a cost of $37,000; one-fourth was paid in cash and the company signed a note for the balance (due in six months). c. Lent $3,000 to one of the investors, who signed a note due in six months. d. John Davis purchased a truck for personal use; paid $5,300 down and signed a one-year note for $23,500. e. Paid $13,500 on the note for the construction equipment in (b) (ignore interest). Required: 1. For each of the preceding transactions, record the effects of the transaction in the appropriate T-accounts. 2. Using the balances in the T-accounts, fill in the following amounts for the accounting equation: 4. Compute the market value per share of the stock. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 4 Compute the market value per share of the stock. (Round your answer to 2 decimal places.) Market value per share per share

Answer 1

Comman Stock
Particulars	Amount $	Particulars	Amount $
		By Cash	750.00
Balance	750.00
	750.00		750.00
Cash
Particulars	Amount $	Particulars	Amount $
To Comman Stock	750.00	By Equipment	9,250.00
To Securities Premium	62,250.00	By Notes Recievable	3,000.00
		By Notes Payable	13,500.00
		Balance	37,250.00
	63,000.00		63,000.00
Equipment
Particulars	Amount $	Particulars	Amount $
To Cash	9,250.00
To Notes Payable	27,750.00
		Balance	37,000.00
	37,000.00		37,000.00
Notes Payable
Particulars	Amount $	Particulars	Amount $
To Cash	13,500.00	By Equipment	27,750.00
Balance	14,250.00
	27,750.00		27,750.00
Notes Recievable
Particulars	Amount $	Particulars	Amount $
To Cash	3,000.00
		Balance	3,000.00
	3,000.00		3,000.00
Land
Particulars	Amount $	Particulars	Amount $
To Securities premium	38,000.00
		Balance	38,000.00
	38,000.00		38,000.00
Securities Premium
Particulars	Amount $	Particulars	Amount $
		By Cash	62,250.00
		By Land	38,000.00
Balance	100,250.00
	100,250.00		100,250.00

* not considered transaction d because truck is purchased for personal use and not saying that payment is from business cash

Capital + Liability	Amount $	Assets	Amount $
Comman stock	750.00	Land	38,000.00
Securities premium	100,250.00	Equipment	37,000.00
		Notes Recievable	3,000.00
Note Payable	14,250.00	Cash	37,250.00
	115,250.00		115,250.00

Market Value Per Share = issue price/number of shares

= (6300+38000)/(2500x3) = (101,000/7,500)

= 13.47 per share