Question

Record journal entries to record the following separate transactions related to issuing stock:

On February 20, a company issues 10,000 shares of $4 par value common stock in exchange for services rendered to help with incorporation. The services are valued at $50,000.

On March 1, a company issues 42,500 shares of $4 par value common stock for $297,500.

On September 10, a company issues 20,000 shares of $20 par value preferred stock for $28 per share.

Date	Account	Debit	Credit

Answer 1

Organization expenses	50,000
Common stock (10,000*4)		40,000
Paid in capital in excess of par common stock		10,000
Cash	297,500
Common stock (42500*4)		170,000
Paid in capital in excess of par common stock		127,500
Cash (28*20,000)	560,000
Preferred stock (20,000*20)		400,000
Paid in capital in excess of par preferred stock		160,000