Question

Ayayai Corp. was organized on January 1, 2017. It is authorized to issue 19,000 shares of 5%, $50 par value preferred stock and 450,000 shares of no-par common stock with a stated value of $1 per share. The following stock transactions were completed during the first year.

Jan. 10 Issued 65,000 shares of common stock for cash at $4 per share.

Mar. 1 Issued 1,100 shares of preferred stock for cash at $54 per share.

May 1 Issued 110,000 shares of common stock for cash at $5 per share.

Sept. 1 Issued 4,000 shares of common stock for cash at $4 per share.

Nov. 1 Issued 2,000 shares of preferred stock for cash at $54 per share.

Journalize these entries.

Answer 1

Journal entry

Date	account and explanation	debit	credit
Jan 10	Cash (65000*4)	260000
	Common Stock (65000*1)		65000
	Paid in capital in excess of stated value-Common Stock		195000
	(To record common stock)
Mar 1	Cash (1100*54)	59400
	Preferred stock		55000
	Paid in capital in excess of par value-Preferred Stock		4400
	(To record preferred stock)
May 1	Cash (110000*5)	550000
	Common Stock		110000
	Paid in capital in excess of stated value-Common Stock		440000
	(To record common stock)
Sep 1	Cash (4000*4)	16000
	Common Stock		4000
	Paid in capital in excess of stated value-Common Stock		12000
	(To record common stock)
Nov 1	Cash (2000*54)	108000
	Preferred stock		100000
	Paid in capital in excess of par value-Preferred Stock		8000
	(To record preferred stock)