Chapter 12 – Corporations: Organization, Stock Transactions, and Dividends
7
Cash
520,000
270,000
ACCT.AICPA.FN.03 – Measurement
ACCT.AICPA.FN.04 – Reporting
BUSPROG: Analytic
DATE CREATED:
7/22/2017 6:31 PM
DATE MODIFIED:
10/16/2017 6:21 PM
160. $150,000
ANSWER:
c
POINTS:
1
161. $100,000
ANSWER:
g
POINTS:
1
162. $60,000
ANSWER:
d
POINTS:
1
163. $20,000
ANSWER:
e
POINTS:
1
164. $235,000
ANSWER:
b
POINTS:
1
165. $330,000
ANSWER:
f
POINTS:
1
166. $550,000
ANSWER:
h
POINTS:
1
167. $15,000
ANSWER:
a
POINTS:
1
168. On April 1, 10,000 shares of $5 par common stock were issued at $22, and on April 7, 5,000 shares of $50 par
preferred stock were issued at $104. Journalize the entries for April 1 and 7.
ANSWER:
Apr. 1
Cash
Common Stock
50,000
Paid-In Capital in Excess of Par
—Common Stock
170,000
Chapter 12 – Corporations: Organization, Stock Transactions, and Dividends
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$125) at $140. On September 9, Epperson issued at par 15,000 shares of 1%, $60 par preferred stock at par for cash. On
November 23, Epperson issued for cash 8,000 shares of 1%, $60 par preferred stock at $70.
Journalize the entries to record the February 13, September 9, and November 23 transactions.
ANSWER:
Feb. 13
Cash (75,000 shares × $140)
10,500,000
Common Stock
9,375,000
Paid-In Capital in Excess of Stated Value
1,125,000
[75,000 shares × ($140 – $125)].
Sept. 9
Cash
900,000
Preferred Stock
900,000
(15,000 shares × $60).
Nov. 23
Cash
560,000
Preferred Stock
480,000
Paid-In Capital in Excess of Par
80,000
[8,000 shares × ($70 – $60)].
POINTS:
1
DIFFICULTY:
Bloom’s: Applying
Moderate
QUESTION TYPE:
Subjective Short Answer
HAS VARIABLES:
False
LEARNING OBJECTIVES:
FNMN.WAJO.19.12–02 – LO: 12–02
ACCREDITING STANDARDS:
ACCT.ACBSP.APC.20 – Accounting for Corporations
ACCT.AICPA.FN.03 – Measurement
BUSPROG: Analytic
DATE CREATED:
7/22/2017 6:31 PM
DATE MODIFIED:
10/16/2017 6:21 PM
174. A corporation was organized on January 1 of the current year, with an authorization of 20,000 shares of 4%, $12 par
preferred stock, and 100,000 shares of $3 par common stock.
The following selected transactions were completed during the first year of operations:
Jan. 3
Issued 15,000 shares of common stock at $23 per share for cash.
31
Issued 200 shares of common stock to an attorney in payment of legal fees for
organizing the corporation. The value of the stock at the time of payment was $25
per share.
Feb. 24
Issued 20,000 shares of common stock in exchange for land, buildings, and
equipment with fair market prices of $65,000, $120,000, and $45,000 respectively.
Mar. 15
Issued 2,000 shares of preferred stock at $56 for cash.
Journalize the transactions.
ANSWER:
Jan. 3
Cash
345,000
Common Stock
45,000
Paid-In Capital in Excess
of Par—Common Stock
300,000
31
Organizational Expenses
5,000
Chapter 12 – Corporations: Organization, Stock Transactions, and Dividends
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Page 67
market price of $21,000.
(c)
Purchased 100 shares of treasury stock at $25.
(d)
Sold the 100 shares of treasury stock purchased in (c) at $30.
ANSWER:
(a)
Cash
56,000
Common Stock
10,000
Paid-In Capital in Excess of Par—
Common Stock
46,000
(b)
Equipment
21,000
Common Stock
14,000
Paid-In Capital in Excess of Par-Common Stock
7,000
(c)
Treasury Stock
2,500
Cash
2,500
(d)
Cash
3,000
Treasury Stock
2,500
Paid-In Capital from Sale of Treasury Stock
500
POINTS:
1
DIFFICULTY:
Bloom’s: Applying
Moderate
QUESTION TYPE:
Subjective Short Answer
HAS VARIABLES:
False
LEARNING OBJECTIVES:
FNMN.WAJO.19.12–02 – LO: 12–02
FNMN.WAJO.19.12–05 – LO: 12–05
ACCREDITING STANDARDS:
ACCT.ACBSP.APC.20 – Accounting for Corporations
ACCT.AICPA.FN.03 – Measurement
BUSPROG: Analytic
DATE CREATED:
7/22/2017 6:31 PM
DATE MODIFIED:
10/16/2017 6:21 PM
178. Prepare entries to record the following:
(a)
Issued 1,000 shares of $10 par common stock at $59 for cash.
(b)
Issued 1,400 shares of $10 par common stock in exchange for equipment with a fair
market price of $60,000.
(c)
Purchased 100 shares of treasury stock at $32.
(d)
Sold the 100 shares of treasury stock purchased in (c) at $42.
ANSWER:
(a)
Cash
59,000
Common Stock
10,000
Paid-In Capital in Excess of Par—Common
Stock
49,000
Equipment
60,000
Common Stock
14,000
Paid-In Capital in Excess of Par—Common
Stock
46,000
(c)
Treasury Stock
3,200